Main Body

Sovereigns and Individuals

7. Sovereigns and Individuals

 

We have so far considered how property is first acquired, how it is defined to accomplish various purposes, and how it is transferred and shared. In the final portion of this course, we will delve more deeply into a group of essential questions posed to any legal system. These questions concern the appropriate role of the public (the collective or the sovereign) and the freedoms of individuals.

 

Property owners typically appeal to rights-based arguments to be free of collective control. The public, on the other hand, points to conflicts between private conduct and important public policies (conflicts that may owe to market failures or to a disconnect between private and public norms). Any society will have to chart a course between the poles of anarchy and stifling statism.

 

We begin by reading a famous U.S. Supreme Court case establishing the right of the United States, and its legislature in particular, to define property relations to meet its current needs, unencumbered by pre-existing natural rights. This case will help us see the difference between sovereignty, which is roughly the right to make rules, and property ownership, which is a bundle of rights defined and protected by a sovereign.

 

Having obtained a better understanding of sovereignty, we will examine private institutions that exercise attributes of sovereignty. Covenants, like constitutions in the public realm, empower private legislatures and executives to make law and govern private communities. To what extent should homeowners’ associations and other private groups have free reign? How should they be regulated by the public?

 

Property owners are themselves a kind of sovereign: kings of their abodes. Their right to exclude others from their realms has been called the most important stick in the bundle of rights that attend property ownership. Exclusion, though, can be used to carry out private purposes that are inimical to deeply held public policies. For example, racial discrimination by private businesses can create a de facto caste system. We will study approaches to regulating private entities’ right to exclude in order to achieve policies of social inclusion and desegregation. To what private entities should “inclusion mandates” apply? Which groups or persons need the backing of public law to gain inclusion? What if it costs money to include? Here again, we will confront a version of the public/private problem, another aspect of the tension between laudable collective goals and individual freedom.

 

We close the course with a traditional and deeply interesting property law topic: takings. Under what circumstances can we, as the government, take for ourselves the property of a private individual? This area of law grapples directly with the conflict between public goals and private prerogatives. We will study two topics: (1) when should government be barred from taking property even if it pays compensation, and (2) when does a government regulation go so far in limiting property rights that it should be considered a taking of property for which compensation is due. This politically charged area of law exposes the inherent difficulty of accomplishing public purposes in a nation of individuals with radically diverse private views and projects.

 

7.1. Sovereignty

 

Johnson v. M’Intosh,

21 U.S. 543 (1823)

 

 

 

March 10, 1823

 

 

 

ERROR to the District Court of Illinois. This was an action of ejectment for lands in the State and District of Illinois, claimed by the plaintiffs under a purchase and conveyance from the Piankeshaw Indians, and by the defendant, under a grant from the United States. It came up on a case stated, upon which there was a judgment below for the defendant. The case stated set out the following facts:

 

[The recitation of the facts in this case is lengthy. Though some will be lost in the summary, what follows is the gist of the dispute. Before 1609 various Native American tribes uses and occupied the disputed lands. In 1609 the lands were among those included in a massive grant by James I to the Virginia colonial company. This company was dissolved in 1624 and the lands reverted to the crown. In 1756, the French and Indian War commenced over the lands west of the Appalachians, including these lands. In 1763, the war ended and the King issued a proclamation reserving the lands west of the Appalachians for the Indians and forbidding British subjects from purchasing these lands. In 1773, despite the proclamation, the Illinois Indians sold the disputed lands to William Murray (and others, all British subjects) for $24,000. In 1775 another group of Indians sold lands to Louis Viviat (and others, again all British subjects). In 1783, the lands were ceded by Virginia to the United States. And in 1818, the United States issued a patent for the lands to William M’Intosh. The dispute is between those whose claim to the lands derive from the transactions with the Indians and those whose claim derives from the United States.]

 

Judgment being given for the defendant on the case stated, the plaintiffs brought this writ of error.

 

 

 

Feb. 17th., 18th, and 19th.

 

 

 

The cause was argued by Mr. Harper and Mr. Webster for the plaintiffs, and by Mr. Winder and Mr. Murray for the defendants. But as the arguments are so fully stated in the opinion of the Court, it is deemed unnecessary to give any thing more than the following summary.

 

On the part of the plaintiffs, it was contended, 1. That upon the facts stated in the case, the Piankeshaw Indians were the owners of the lands in dispute, at the time of executing the deed of October 10th, 1775, and had power to sell. But as the United States had purchased the same lands of the same Indians, both parties claim from the same source. It would seem, therefore, to be unnecessary, and merely speculative, to discuss the question respecting the sort of title or ownership, which may be thought to belong to savage tribes, in the lands on which they live. Probably, however, their title by occupancy is to be respected, as much as that of an individual, obtained by the same right, in a civilized state. The circumstance, that the members of the society held in common, did not affect the strength of their title by occupancy.1 In the memorial, or manifesto, of the British government, in 1755, a right of soil in the Indians is admitted. It is also admitted in the treaties of Utrecht and Aix la Chapelle. The same opinion has been expressed by this Court,2 and by the Supreme Court of New-York.3 In short, all, or nearly all, the lands in the United States, is holden under purchases from the Indian nations; and the only question in this case must be, whether it be competent to individuals to make such purchases, or whether that be the exclusive prerogative of government.

 

2. That the British king’s proclamation of October 7th, 1763, could not affect this right of the Indians to sell; because they were not British subjects, nor in any manner bound by the authority of the British government, legislative or executive. And, because, even admitting them to be British subjects, absolutely, or sub modo, they were still proprietors of the soil, and could not be devested of their rights of property, or any of its incidents, by a mere act of the executive government, such as this proclamation.

 

3. That the proclamation of 1763 could not restrain the purchasers under these deeds from purchasing; because the lands lay within the limits of the colony of Virginia, of which, or of some other British colony, the purchasers, all being British subjects, were inhabitants. And because the king had not, within the limits of that colonial government, or any other, any power of prerogative legislation; which is confined to countries newly conquered, and remaining in the military possession of the monarch, as supreme chief of the military forces of the nation. The present claim has long been known to the government of the United States, and is mentioned in the Collection of Land Laws, published under public authority. The compiler of those laws supposes this title void, by virtue of the proclamation of 1763. But we have the positive authority of a solemn determination of the Court of King’s Bench, on this very proclamation, in the celebrated Grenada case, for asserting that it could have no such effect.4 This country being a new conquest, and a military possession, the crown might exercise legislative powers, until a local legislature was established. But the establishment of a government establishes a system of laws, and excludes the power of legislating by proclamation. The proclamation could not have the force of law within the chartered limits of Virginia. A proclamation, that no person should purchase land in England or Canada, would be clearly void.

 

4. That the act of Assembly of Virginia, passed in May, 1779,5 cannot affect the right of the plaintiffs, and others claiming under these deeds; because, on general principles, and by the constitution of Virginia, the legislature was not competent to take away private, vested rights, or appropriate private property to public use, under the circumstances of this case. And because the act is not contained in the revisal of 1794, and must, therefore, be considered as repealed; and the repeal reinstates all rights that might have been affected by the act, although the territory, in which the lands in question lie, was ceded to the United States before the repeal. The act of 1779 was passed after the sales were made, and it cannot affect titles previously obtained. At the time of the purchases there was no law of Virginia rendering such purchases void. If, therefore, the purchases were not affected by the proclamation of 1763, nor by the act of 1779, the question of their validity comes to the general inquiry, whether individuals, in Virginia, at the time of this purchase, could legally obtain Indian titles. In New-England, titles have certainly been obtained in this mode. But whatever may be said on the more general question, and in reference to other colonies or States, the fact being, that in Virginia there was no statute existing at the time against such purchases, mere general considerations would not apply. It may be true, that in almost all the colonies, individual purchases from the Indians were illegal; but they were rendered so by express provisions of the local law. In Virginia, also, it may be true, that such purchases have generally been prohibited; but at the time the purchases now in question were made, there was no prohibitory law in existence. The old colonial laws on the subject had all been repealed. The act of 1779 was a private act, so far as respects this case. It is the same as if it had enacted, that these particular deeds were void. Such acts bind only those who are parties to them, who submit their case to the Legislature.

 

On the part of the defendants, it was insisted, that the uniform understanding and practice of European nations, and the settled law, as laid down by the tribunals of civilized states, denied the right of the Indians to be considered as independent communities, having a permanent property in the soil, capable of alienation to private individuals. They remain in a state of nature, and have never been admitted into the general society of nations.6 All the treaties and negotiations between the civilized powers of Europe and of this continent, from the treaty of Utrecht, in 1713, to that of Ghent, in 1814, have uniformly disregarded their supposed right to the territory included within the jurisdictional limits of those powers.7 Not only has the practice of all civilized nations been in conformity with this doctrine, but the whole theory of their titles to lands in America, rests upon the hypothesis, that the Indians had no right of soil as sovereign, independent states. Discovery is the foundation of title, in European nations, and this overlooks all proprietary rights in the natives.8 The sovereignty and eminent domain thus acquired, necessarily precludes the idea of any other sovereignty existing within the same limits. The subjects of the discovering nation must necessarily be bound by the declared sense of their own government, as to the extent of this sovereignty, and the domain acquired with it. Even if it should be admitted that the Indians were originally an independent people, they have ceased to be so. A nation that has passed under the dominion of another, is no longer a sovereign state.9 The same treaties and negotiations, before referred to, show their dependent condition. Or, if it be admitted that they are now independent and foreign states, the title of the plaintiffs would still be invalid: as grantees from the Indians, they must take according to their laws of property, and as Indian subjects. The law of every dominion affects all persons and property situate within it;10 and the Indians never had any idea of individual property in lands. It cannot be said that the lands conveyed were disjoined from their dominion; because the grantees could not take the sovereignty and eminent domain to themselves.

 

Such, then, being the nature of the Indian title to lands, the extent of their right of alienation must depend upon the laws of the dominion under which they live. They are subject to the sovereignty of the United States. The subjection proceeds from their residence within our territory and jurisdiction. It is unnecessary to show, that they are not citizens in the ordinary sense of that term, since they are destitute of the most essential rights which belong to that character. They are of that class who are said by jurists not to be citizens, but perpetual inhabitants with diminutive rights.11 The statutes of Virginia, and of all the other colonies, and of the United States, treat them as an inferior race of people, without the privileges of citizens, and under the perpetual protection and pupilage of the government. The act of Virginia of 1662, forbade purchases from the Indians, and it does not appear that it was ever repealed. The act of 1779 is rather to be regarded as a declaratory act, founded upon what had always been regarded as the settled law. These statutes seem to define sufficiently the nature of the Indian title to lands; a mere right of usufruct and habitation, without power of alienation. By the law of nature, they had not acquired a fixed property capable of being transferred. The measure of property acquired by occupancy is determined, according to the law of nature, by the extent of men’s wants, and their capacity of using it to supply them.12 It is a violation of the rights of others to exclude them from the use of what we do not want, and they have an occasion for. Upon this principle the North American Indians could have acquired no proprietary interest in the vast tracts of territory which they wandered over; and their right to the lands on which they hunted, could not be considered as superior to that which is acquired to the sea by fishing in it. The use in the one case, as well as the other, is not exclusive.13 According to every theory of property, the Indians had no individual rights to land; nor had they any collectively, or in their national capacity; for the lands occupied by each tribe were not used by them in such a manner as to prevent their being appropriated by a people of cultivators. All the proprietary rights of civilized nations on this continent are founded on this principle. The right derived from discovery and conquest, can rest on no other basis; and all existing titles depend on the fundamental title of the crown by discovery. The title of the crown (as representing the nation) passed to the colonists by charters, which were absolute grants of the soil; and it was a first principle in colonial law, that all titles must be derived from the crown. It is true that, in some cases, purchases were made by the colonies from the Indians; but this was merely a measure of policy to prevent hostilities; and William Penn’s purchase, which was the most remarkable transaction of this kind, was not deemed to add to the strength of his title.14 In most of the colonies, the doctrine was received, that all titles ot land must be derived exclusively from the crown, upon the principle that the settlers carried with them, not only all the rights, but all the duties of Englishmen; and particularly the laws of property, so far as they are suitable to their new condition.15 In New-England alone, some lands have been held under Indian deeds. But this was an anomaly arising from peculiar local and political causes.16

 

As to the effect of the proclamation of 1763: if the Indians are to be regarded as independent sovereign states, then, by the treaty of peace, they became subject to the prerogative legislation of the crown, as a conquered people, in a territory acquired, jure belli, and ceded at the peace.17 If, on the contrary, this country be regarded as a royal colony, then the crown had a direct power of legislation; or at least the power of prescribing the limits within which grants of land and settlements should be made within the colony. The same practice always prevailed under the proprietary governments, and has been followed by the government of the United States.

 

 

 

March 10th.

 

Mr. Chief Justice Marshall delivered the opinion of the Court.

 

The plaintiffs in this cause claim the land, in their declaration mentioned, under two grants, purporting to be made, the first in 1773, and the last in 1775, by the chiefs of certain Indian tribes, constituting the Illinois and the Piankeshaw nations; and the question is, whether this title can be recognised in the Courts of the United States?

 

The facts, as stated in the case agreed, show the authority of the chiefs who executed this conveyance, so far as it could be given by their own people; and likewise show, that the particular tribes for whom these chiefs acted were in rightful possession of the land they sold. The inquiry, therefore, is, in a great measure, confined to the power of Indians to give, and of private individuals to receive, a title which can be sustained in the Courts of this country.

 

As the right of society, to prescribe those rules by which property may be acquired and preserved is not, and cannot be drawn into question; as the title to lands, especially, is and must be admitted to depend entirely on the law of the nation in which they lie; it will be necessary, in pursuing this inquiry, to examine, not singly those principles of abstract justice, which the Creator of all things has impressed on the mind of his creature man, and which are admitted to regulate, in a great degree, the rights of civilized nations, whose perfect independence is acknowledged; but those principles also which our own government has adopted in the particular case, and given us as the rule for our decision.

 

On the discovery of this immense continent, the great nations of Europe were eager to appropriate to themselves so much of it as they could respectively acquire. Its vast extent offered an ample field to the ambition and enterprise of all; and the character and religion of its inhabitants afforded an apology for considering them as a people over whom the superior genius of Europe might claim an ascendency. The potentates of the old world found no difficulty in convincing themselves that they made ample compensation to the inhabitants of the new, by bestowing on them civilization and Christianity, in exchange for unlimited independence. But, as they were all in pursuit of nearly the same object, it was necessary, in order to avoid conflicting settlements, and consequent war with each other, to establish a principle, which all should acknowledge as the law by which the right of acquisition, which they all asserted, should be regulated as between themselves. This principle was, that discovery gave title to the government by whose subjects, or by whose authority, it was made, against all other European governments, which title might be consummated by possession.

 

The exclusion of all other Europeans, necessarily gave to the nation making the discovery the sole right of acquiring the soil from the natives, and establishing settlements upon it. It was a right with which no Europeans could interfere. It was a right which all asserted for themselves, and to the assertion of which, by others, all assented.

 

Those relations which were to exist between the discoverer and the natives, were to be regulated by themselves. The rights thus acquired being exclusive, no other power could interpose between them.

 

In the establishment of these relations, the rights of the original inhabitants were, in no instance, entirely disregarded; but were necessarily, to a considerable extent, impaired. They were admitted to be the rightful occupants of the soil, with a legal as well as just claim to retain possession of it, and to use it according to their own discretion; but their rights to complete sovereignty, as independent nations, were necessarily diminished, and their power to dispose of the soil at their own will, to whomsoever they pleased, was denied by the original fundamental principle, that discovery gave exclusive title to those who made it.

 

While the different nations of Europe respected the right of the natives, as occupants, they asserted the ultimate dominion to be in themselves; and claimed and exercised, as a consequence of this ultimate dominion, a power to grant the soil, while yet in possession of the natives. These grants have been understood by all, to convey a title to the grantees, subject only to the Indian right of occupancy.

 

The history of America, from its discovery to the present day, proves, we think, the universal recognition of these principles.

 

[Marshall discusses the numerous European claims that have been based on discovery and patents issued on the basis of discovery.]

 

Thus has our whole country been granted by the crown while in the occupation of the Indians. These grants purport to convey the soil as well as the right of dominion to the grantees. In those governments which were denominated royal, where the right to the soil was not vested in individuals, but remained in the crown, or was vested in the colonial government, the king claimed and exercised the right of granting lands, and of dismembering the government at his will. The grants made out of the two original colonies, after the resumption of their charters by the crown, are examples of this. The governments of New-England, New-York, New-Jersey, Pennsylvania, Maryland, and a part of Carolina, were thus created. In all of them, the soil, at the time the grants were made, was occupied by the Indians. Yet almost every title within those governments is dependent on these grants. In some instances, the soil was conveyed by the crown unaccompanied by the powers of government, as in the case of the northern neck of Virginia. It has never been objected to this, or to any other similar grant, that the title as well as possession was in the Indians when it was made, and that it passed nothing on that account.

 

These various patents cannot be considered as nullities; nor can they be limited to a mere grant of the powers of government. A charter intended to convey political power only, would never contain words expressly granting the land, the soil, and the waters. Some of them purport to convey the soil alone; and in those cases in which the powers of government, as well as the soil, are conveyed to individuals, the crown has always acknowledged itself to be bound by the grant. Though the power to dismember regal governments was asserted and exercised, the power to dismember proprietary governments was not claimed; and, in some instances, even after the powers of government were revested in the crown, the title of the proprietors to the soil was respected.

 

… .

 

Thus, all the nations of Europe, who have acquired territory on this continent, have asserted in themselves, and have recognised in others, the exclusive right of the discoverer to appropriate the lands occupied by the Indians. Have the American States rejected or adopted this principle?

 

By the treaty which concluded the war of our revolution, Great Britain relinquished all claim, not only to the government, but to the ‘propriety and territorial rights of the United States,’ whose boundaries were fixed in the second article. By this treaty, the powers of government, and the right to soil, which had previously been in Great Britain, passed definitively to these States. We had before taken possession of them, by declaring independence; but neither the declaration of independence, nor the treaty confirming it, could give us more than that which we before possessed, or to which Great Britain was before entitled. It has never been doubted, that either the United States, or the several States, had a clear title to all the lands within the boundary lines described in the treaty, subject only to the Indian right of occupancy, and that the exclusive power to extinguish that right, was vested in that government which might constitutionally exercise it.

 

Virginia, particularly, within whose chartered limits the land in controversy lay, passed an act, in the year 1779, declaring her ‘exclusive right of pre-emption from the Indians, of all the lands within the limits of her own chartered territory, and that no person or persons whatsoever, have, or ever had, a right to purchase any lands within the same, from any Indian nation, except only persons duly authorized to make such purchase; formerly for the use and benefit of the colony, and lately for the Commonwealth.’The act then proceeds to annul all deeds made by Indians to individuals, for the private use of the purchasers.

 

Without ascribing to this act the power of annulling vested rights, or admitting it to countervail the testimony furnished by the marginal note opposite to the title of the law, forbidding purchases from the Indians, in the revisals of the Virginia statutes, stating that law to be repealed, it may safely be considered as an unequivocal affirmance, on the part of Virginia, of the broad principle which had always been maintained, that the exclusive right to purchase from the Indians resided in the government.

 

In pursuance of the same idea, Virginia proceeded, at the same session, to open her land office, for the sale of that country which now constitutes Kentucky, a country, every acre of which was then claimed and possessed by Indians, who maintained their title with as much persevering courage as was ever manifested by any people.

 

The States, having within their chartered limits different portions of territory covered by Indians, ceded that territory, generally, to the United States, on conditions expressed in their deeds of cession, which demonstrate the opinion, that they ceded the soil as well as jurisdiction, and that in doing so, they granted a productive fund to the government of the Union. The lands in controversy lay within the chartered limits of Virginia, and were ceded with the whole country northwest of the river Ohio. This grant contained reservations and stipulations, which could only be made by the owners of the soil; and concluded with a stipulation, that ‘all the lands in the ceded territory, not reserved, should be considered as a common fund, for the use and benefit of such of the United States as have become, or shall become, members of the confederation,’ &c. ‘according to their usual respective proportions in the general charge and expenditure, and shall be faithfully and bona fide disposed of for that purpose, and for no other use or purpose whatsoever.’

 

The ceded territory was occupied by numerous and warlike tribes of Indians; but the exclusive right of the United States to extinguish their title, and to grant the soil, has never, we believe, been doubted.

 

After these States became independent, a controversy subsisted between them and Spain respecting boundary. By the treaty of 1795, this controversy was adjusted, and Spain ceded to the United States the territory in question. This territory, though claimed by both nations, was chiefly in the actual occupation of Indians.

 

The magnificent purchase of Louisiana, was the purchase from France of a country almost entirely occupied by numerous tribes of Indians, who are in fact independent. Yet, any attempt of others to intrude into that country, would be considered as an aggression which would justify war.

 

Our late acquisitions from Spain are of the same character; and the negotiations which preceded those acquisitions, recognise and elucidate the principle which has been received as the foundation of all European title in America.

 

The United States, then, have unequivocally acceded to that great and broad rule by which its civilized inhabitants now hold this country. They hold, and assert in themselves, the title by which it was acquired. They maintain, as all others have maintained, that discovery gave an exclusive right to extinguish the Indian title of occupancy, either by purchase or by conquest; and gave also a right to such a degree of sovereignty, as the circumstances of the people would allow them to exercise.

 

The power now possessed by the government of the United States to grant lands, resided, while we were colonies, in the crown, or its grantees. The validity of the titles given by either has never been questioned in our Courts. It has been exercised uniformly over territory in possession of the Indians. The existence of this power must negative the existence of any right which may conflict with, and control it. An absolute title to lands cannot exist, at the same time, in different persons, or in different governments. An absolute, must be an exclusive title, or at least a title which excludes all others not compatible with it. All our institutions recognise the absolute title of the crown, subject only to the Indian right of occupancy, and recognise the absolute title of the erown to extinguish that right. This is incompatible with an absolute and complete title in the Indians.

 

We will not enter into the controversy, whether agriculturists, merchants, and manufacturers, have a right, on abstract principles, to expel hunters from the territory they possess, or to contract their limits. Conquest gives a title which the Courts of the conqueror cannot deny, whatever the private and speculative opinions of individuals may be, respecting the original justice of the claim which has been successfully asserted. The British government, which was then our government, and whose rights have passed to the United States, asserted title to all the lands occupied by Indians, within the chartered limits of the British colonies. It asserted also a limited sovereignty over them, and the exclusive right of extinguishing the title which occupancy gave to them. These claims have been maintained and established as far west as the river Mississippi, by the sword. The title to a vast portion of the lands we now hold, originates in them. It is not for the Courts of this country to question the validity of this title, or to sustain one which is incompatible with it.

 

Although we do not mean to engage in the defence of those principles which Europeans have applied to Indian title, they may, we think, find some excuse, if not justification, in the character and habits of the people whose rights have been wrested from them.

 

The title by conquest is acquired and maintained by force. The conqueror prescribes its limits. Humanity, however, acting on public opinion, has established, as a general rule, that the conquered shall not be wantonly oppressed, and that their condition shall remain as eligible as is compatible with the objects of the conquest. Most usually, they are incorporated with the victorious nation, and become subjects or citizens of the government with which they are connected. The new and old members of the society mingle with each other; the distinction between them is grandually lost, and they make one people. Where this incorporation is practicable, humanity demands, and a wise policy requires, that the rights of the conquered to property should remain unimpaired; that the new subjects should be governed as equitably as the old, and that confidence in their security should gradually banish the painful sense of being separated from their ancient connexions, and united by force to strangers.

 

When the conquest is complete, and the conquered inhabitants can be blended with the conquerors, or safely governed as a distinct people, public opinion, which not even the conqueror can disregard, imposes these restraints upon him; and he cannot neglect them without injury to his fame, and hazard to his power.

 

But the tribes of Indians inhabiting this country were fierce savages, whose occupation was war, and whose subsistence was drawn chiefly from the forest. To leave them in possession of their country, was to leave the country a wilderness; to govern them as a distinct people, was impossible, because they were as brave and as high spirited as they were fierce, and were ready to repel by arms every attempt on their independence.

 

What was the inevitable consequence of this state of things? The Europeans were under the necessity either of abandoning the country, and relinquishing their pompous claims to it, or of enforcing those claims by the sword, and by the adoption of principles adapted to the condition of a people with whom it was impossible to mix, and who could not be governed as a distinct society, or of remaining in their neighbourhood, and exposing themselves and their families to the perpetual hazard of being massacred.

 

Frequent and bloody wars, in which the whites were not always the aggressors, unavoidably ensued. European policy, numbers, and skill, prevailed. As the white population advanced, that of the Indians necessarily receded. The country in the immediate neighbourhood of agriculturists became unfit for them. The game fled into thicker and more unbroken forests, and the Indians followed. The soil, to which the crown originally claimed title, being no longer occupied by its ancient inhabitants, was parcelled out according to the will of the sovereign power, and taken possession of by persons who claimed immediately from the crown, or mediately, through its grantees or deputies.

 

That law which regulates, and ought to regulate in general, the relations between the conqueror and conquered, was incapable of application to a people under such circumstances. The resort to some new and different rule, better adapted to the actual state of things, was unavoidable. Every rule which can be suggested will be found to be attended with great difficulty.

 

However extravagant the pretension of converting the discovery of an inhabited country into conquest may appear; if the principle has been asserted in the first instance, and afterwards sustained; if a country has been acquired and held under it; if the property of the great mass of the community originates in it, it becomes the law of the land, and cannot be questioned. So, too, with respect to the concomitant principle, that the Indian inhabitants are to be considered merely as occupants, to be protected, indeed, while in peace, in the possession of their lands, but to be deemed incapable of transferring the absolute title to others. However this restriction may be opposed to antural right, and to the usages of civilized nations, yet, if it be indispensable to that system under which the country has been settled, and be adapted to the actual condition of the two people, it may, perhaps, be supported by reason, and certainly cannot be rejected by Courts of justice.

 

This question is not entirely new in this Court. The case of Fletcher v. Peck, grew out of a sale made by the State of Georgia of a large tract of country within the limits of that State, the grant of which was afterwards resumed. The action was brought by a sub-purchaser, on the contract of sale, and one of the covenants in the deed was, that the State of Georgia was, at the time of sale, seised in fee of the premises. The real question presented by the issue was, whether the seisin in fee was in the State of Georgia, or in the United States. After stating, that this controversy between the several States and the United States, had been compromised, the Court thought in necessary to notice the Indian title, which, although entitled to the respect of all Courts until it should be legitimately extinguished, was declared not to be such as to be absolutely repugnant to a seisin in fee on the part of the State.

 

This opinion conforms precisely to the principle which has been supposed to be recognised by all European governments, from the first settlement of America. The absolute ultimate title has been considered as acquired by discovery, subject only to the Indian title of occupancy, which title the discoverers possessed the exclusive right of acquiring. Such a right is no more incompatible with a seisin in fee, than a lease for years, and might as effectually bar an ejectment.

 

Another view has been taken of this question, which deserves to be considered. The title of the crown, whatever it might be, could be acquired only by a coveyance from the crown. If an individual might extinguish the Indian title for his own benefit, or, in other words, might purchase it, still he could acquire only that title. Admitting their power to change their laws or usages, so far as to allow an individual to separate a portion of their lands from the common stock, and hold it in severalty, still it is a part of their territory, and is held under them, by a title dependent on their laws. The grant derives its efficacy from their will; and, if they choose to resume it, and make a different disposition of the land, the Courts of the United States cannot interpose for the protection of the title. The person who purchases lands from the Indians, within their territory, incorporates himself with them, so far as respects the property purchased; holds their title under their protection, and subject to their laws. If they annul the grant, we know of no tribunal which can revise and set aside the proceeding. We know of no principle which can distinguish this case from a grant made to a native Indian, authorizing him to hold a particular tract of land in severalty.

 

As such a grant could not separate the Indian from his nation, nor give a title which our Courts could distinguish from the title of his tribe, as it might still be conquered from, or ceded by his tribe, we can perceive no legal principle which will authorize a Court to say, that different consequences are attached to this purchase, because it was made by a stranger. By the treaties concluded between the United States and the Indian nations, whose title the plaintiffs claim, the country comprehending the lands in controversy has been ceded to the United States, without any reservation of their title. These nations had been at war with the United States, and had an unquestionable right to annul any grant they had made to American citizens. Their cession of the country, without a reservation of this land, affords a fair presumption, that they considered it as of no validity. They ceded to the United States this very property, after having used it in common with other lands, as their own, from the date of their deeds to the time of cession; and the attempt now made, is to set up their title against that of the United States.

 

… .

 

After bestowing on this subject a degree of attention which was more required by the magnitude of the interest in litigation, and the able and elaborate arguments of the bar, than by its intrinsic difficulty, the Court is decidedly of opinion, that the plaintiffs do not exhibit a title which can be sustained in the Courts of the United States; and that there is no error in the judgment which was rendered against them in the District Court of Illinois.

 

Judgment affirmed, with costs.

 


    1. Grotius, de J. B. ac P. l. 2. c. 2. s. 4. l. 2. c. 24. s. 9. Puffen. l. 4. c. 5. s. 1. 3.

 

    1. Fletcher v. Peck, 6 Cranch’s Rep. 646.

 

    1. Jackson v. Wood, 7 Johns. Rep. 296.

 

    1. Campbell v. Hall, 1 Cowp. Rep. 204.

 

    1. This statute is as follows: ‘An act for declaring and asserting the rights of this Commonwealth, concerning purchasing lands from Indian natives. To remove and prevent all doubt concerning purchases of lands from the Indian natives, Be it declared by the General Assembly, that this Commonwealth hath the exclusive right of pre-emption from the Indians, of all the lands within the limits of its own chartered territory, as described by the act and constitution of government, in the year 1776. That no person or persons whatsoever, have, or ever had, a right to purchase any lands within the same, from any Indian nation, except only persons duly authorized to make such purchases on the public account, formerly for the use and benefit of the colony, and lately of the Commonwealth, and that such exclusive right or pre-emption, will and ought to be maintained by this Commonwealth, to the utmost of its power.

      ‘And be it further declared and enacted, That every purchase of lands heretofore made, by, or on behalf of, the crown of England or Great Britain, from any Indian nation or nations, within the before mentioned limits, doth and ought to enure for ever, to and for the use and benefit of this Commonwealth, and to or for no other use or purpose whatsoever; and that all sales and deeds which have been, or shall be made by any Indian or Indians, or by any Indian nation or nations, for lands within the said limits, to or for the separate use of any person or persons whatsoever shall be, and the same are, hereby declared utterly void and of no effect.’

 

    1. Penn v. Lord Baltimore, 1 Ves. 445. 2 Rutherforth’s Inst. 29. Locke, Government, b. 2. c. 7. s. 87-89. c. 12. s. 143. c. 9. s. 123-130. Jefferson’s Notes, 126. Colden’s Hist. Five Nations, 2-16. Smith’s Hist. New-York, 35-41. Montesquieu, Esprit des Loix, l. 18. c. 11, 12, 13. Smith’s Wealth of Nations, b. 5. c. 1.

 

    1. 5 Annual Reg. 56. 233. 7 Niles’ Reg. 229.

 

    1. Marten’s Law of Nations, 67. 69. Vattel, Droit des Gens. l. 2. c. 7. s. 83. l. 1. c. 18. s. 204, 205.

 

    1. Vattle, 1. 1. c. 1. s. 11.

 

    1. Cowp. Rep. 204.

 

    1. Vattel, l. 1. c. 19. s. 213.

 

    1. Grotius, l. 2. c. 11. Barbeyr. Puffend. l. 4. c. 4. s. 2. 4. 2 Bl. Comm. 2. Puffend. l. 4. c. 6. s. 3. Locke on Government, b. 2. c. 5. s. 26.34-40.

 

    1. Locke, c. 5. s. 36-48. Grotius, l. 2. c. 11. s. 2. Montesquieu, tom. 2. p. 63. Chalmers’ Polit. Annals, 5. 6 Cranch’s Rep. 87.

 

    1. Penn v. Lord Baltimore, 1 Ves. 444. Chalmers’ Polit. Annals, 644. Sullivan’s Land Tit. c. 2. Smith’s Hist. N. Y. 145. 184.

 

    1. 1 Bl. Comm. 107. 2 P. Wms. 75. 1 Salk. 411. 616.

 

    1. Sulliv. Land Tit. 45.

 

    1. Cowp. 204. 7 Co. Rep. 17 b. 2 Meriv. Rep. 143.

 

 

 

PROBLEMS

 

 

 

    1. State the sources of title for each of the two sides in the litigation.

       

 

    1. Which side relies on a Lockean argument and what is that argument?

       

 

    1. What kind of interest does “discovery” establish, according to Marshall?

       

 

 

 

7.2. Private Government

 

O’Buck v. Cottonwood Village Condominium Association, Inc.,

750 P.2d 813 (1988)

 

 

 

Donald D. Hopwood and David Gorman, Kay, Saville, Coffey, Hopwood & Schmid, Anchorage, for appellants.

 

William L. McNall and David Rankine, Law Offices of William L. McNall, Anchorage, for appellee.

 

Before Rabinowitz, C.J. and Burke, Matthews, Compton and Moore, JJ.

 

 

 

Rabinowitz, Chief Justice.

 

 

 

In this case the owners of a condominium unit brought suit against the condominium association challenging a rule banning the mounting of television antennae anywhere on the buildings. After a non-jury trial, the superior court entered judgment in favor of the association.

 

We hold the rule banning antennae valid and thus affirm.

 

 

 

I.

 

 

 

John and Janie O’Buck, plaintiffs and appellants in this case, purchased a unit in the Cottonwood Village Condominiums in June 1981. At that time, the unit was pre-wired for a central television antenna and for Visions, an antenna-based cable system. It is impossible to watch television in the unit without an outdoor antenna or cable because of bad reception. The availability of an antenna was an important consideration for the O’Bucks in deciding to purchase their unit because they have four televisions and frequently watch different programs.

 

In 1984, the Board of Directors of the Cottonwood Village Association (“the Board” or “the Association”) had to address a serious problem of roof leakage in the condominiums. Among the several causes of leakage were badly mounted antennae and foot traffic on the roof related to the antennae. The Association paid $155,000 to have the roofs repaired. In order to do the work, the contractors removed all the antennae from the roofs. Before any of the antennae were reinstalled, the Board adopted a rule prohibiting the mounting of television antennae anywhere on the buildings. The purposes of this rule were to protect the roof and to enhance the marketability of the condominium units. The Board further decided to make the MultiVisions cable system available as an alternative to antennae. The Board rejected other alternatives such as a satellite dish or antennae mounted on the sides of the buildings. The Board offered to pay the fifteen dollar hookup fee to MultiVisions and to pay for the depreciated value of the old antennae. The O’Bucks were paid $284.20 for their antenna, which had been damaged when contractors removed it from the roof. The O’Bucks now have one television hooked up to MultiVisions. Their other sets have no reception, and it would cost ten dollars per month per set to hook them up.

 

The O’Bucks subsequently filed a complaint against the Association seeking damages and an injunction against enforcement of the rule. After a non-jury trial the superior court ruled against the O’Bucks on all issues, denying them any relief… . .

 

In this appeal, the O’Bucks argue that the Board had no authority under the Declaration and Bylaws of the Condominium Association to adopt the antennae rule, that the rule was unreasonable, that the procedure by which the Board passed the rule was flawed, that the O’Bucks have an easement for their antenna, and that it was an abuse of discretion for the trial court to award the Association such a high percentage of its attorney’s fees.

 

 

 

II.

 

 

 

 

 

 

A. Was the Board Authorized to Pass the Rule?

 

 

 

 

The O’Bucks challenge the Board’s authority to adopt the rule. We conclude that the Board had authority to enact a rule banning television antennae from buildings under either of two provisions in the Declaration of Condominium, the “constitution” of the Association. See AS 34.07.010-.070.

 

First, article IX, section 4 of the Declaration authorizes the Board to adopt rules and regulations governing the use of the common areas, which include the roofs and walls of the buildings. That section provides:

 

 

Rules and Regulations. Rules and regulations may be adopted by the Board of Directors concerning and governing the use of the general and limited common areas providing such rules and regulations shall be furnished to owners prior to the time they become effective and that such rules and regulations shall be uniform and nondiscriminatory.

 

 

Second, article XIX, section 1(d) of the Declaration authorizes the Board to require unit owners to take action to preserve a uniform exterior appearance to the buildings. That section provides:

 

 

In order to preserve a uniform exterior appearance to the building, the Board may require the painting of the building, decks and balconies, and prescribe the type and color of paint, and may prohibit, require, or regulate any modification or decoration of the building, decks and balconies undertaken or proposed by any owner. This power of the Board extends to screens, doors, awnings, rails or other visible portions of each condominium unit and condominium building. The Board may also require use of a uniform color of draperies or drapery lining for all units.

 

 

(Emphasis supplied.) The superior court relied on this provision in reaching its decision.

 

Given these two provisions, the Board had authority to ban antennae either on roof-protection grounds (under article IX, section 4) or on aesthetic grounds (under either section), both of which were given as reasons for the antennae rule.1

 

The O’Bucks argue that other provisions of the Declaration and Bylaws imply a right to own antennae that is superior to the Board’s authority to ban them. Therefore, they argue that any antennae rule could be passed only after amendments to the Declaration and Bylaws, which would require approval by 60% of the unit owners.2

 

The O’Bucks infer the right to mount television antennae on the buildings from article V, section 5 of the Declaration, which protects the ownership of private property in common areas:

 

 

Certain items which might ordinarily be considered common areas, such as, but not limited to, screen doors, window boxes, awnings, storm windows, planter boxes, antennae, and the like, may, pursuant to decision of the owner and specifications in the Bylaws or administrative rules, be designated as private or individual items to be furnished and maintained at individual expense, in good order, according to standards and requirements set by the Board by rule, regulation or Bylaw.

 

 

(Emphasis supplied.) They also cite article VIII, section 1(g) of the Bylaws, which provides:

 

 

No Unit Owner or occupant shall, without the written approval of the Board of Directors, install any wiring for electrical or telephone installations, television antenna [sic], machines or air-conditioning units, or other equipment or appurtenances whatsoever on the exterior of the Project or protruding through the walls, windows or roof thereof.

 

 

(Emphasis supplied.) The O’Bucks also cite several provisions of the Declaration and Bylaws which explicitly prohibit or authorize the prohibition of other things, such as pets, modification of buildings, and posting of bills. They reason that since there is no explicit authorization to prohibit antennae, and since the Declaration and Bylaws contemplate the existence of antennae, a right to have an antenna is reasonably inferred and cannot be taken away without amending the Declaration or Bylaws. They rely on Beachwood Villas Condominium v. Poor, 448 So.2d 1143, 1145 (Fla. App. 1984), which held: “provided that a board-enacted rule does not contravene either an express provision of the declaration or a right reasonably inferable therefrom, it will be found valid, within the scope of the board’s authority.” (Emphasis supplied.)

 

We do not find the O’Bucks’ arguments persuasive. The mere mention of the word “antennae” in article V, section 5 of the Declaration does not allow an owner reasonably to infer a right that is superior to the Board’s authority to ban them. First, that section explicitly makes the items listed, including antennae, subject to rules and regulations of the Board. Second, article V merely defines what constitutes common areas, and the purpose of section 5 is to clarify that the privately-owned items listed do not necessarily pass into common ownership merely because of their presence in common areas. An owner may not seize upon such a clarification to claim an irrevocable right to maintain any of the items listed in a common area.

 

The absence of any provision explicitly authorizing the Board to ban antennae is not fatal to the Board’s right to do so. As noted in Beachwood Villas, “[i]t would be impossible to list all restrictive uses in a declaration of condominium.” 448 So.2d at 1145. Thus, in that case the court upheld board-enacted rules regulating unit rentals and the occupancy of units by guests during the owner’s absence. The court refused to find a reasonably inferable right and upheld the rules even in the absence of an express provision authorizing them. Id.

 

The O’Bucks also rely on Chateau Village North Condominium Association v. Jordan, 643 P.2d 791 (Colo. App. 1982). The board in that case began a policy of denying all new applications for pets. Cottonwood’s Bylaw article VIII, section 1(g), supra, is similar to the bylaw provisions at issue in Chateau Village: “No cats, dogs, or other animal … shall be kept, maintained, or harbored in the development unless the same in each instance is expressly permitted in writing by the Managing Agent… .” 643 P.2d at 791. Both provisions explicitly prohibit the matter in question without written permission. The court in Chateau Village found in this bylaw provision a right to apply for permission to keep animals and a “duty” on the part of the association “to consider [the owner’s] application and apply its discretion in a reasonable and good faith manner.” Id. at 792. Because the association had adopted a policy of prohibiting all pets without ruling on the merits of individual applications, the court ordered that the complaint of the association against the owner be dismissed. Id. at 792-93.

 

The O’Bucks argue that under Chateau Village, Bylaw article VIII, section 1(g), requires the Association to deliberate on the merits of all applications to install antennae, and prohibits the Association from adopting a blanket rule against them. This interpretation fails to recognize important differences between the two cases. The board in Chateau Village was merely applying “its own policy,” 643 P.2d at 793, which it had implemented without any authority. See id. at 792. In contrast, the Board in the instant case acted under the authority of numerous provisions authorizing rules and regulations governing the use of the common areas. These provisions give the Board broad discretion to adopt rules and regulations to preserve a uniform exterior appearance to the building, as well as to preserve the structural integrity of the buildings in general and the roofs in particular. These grants of authority are adequate to uphold a blanket rule.

 

For these reasons, we hold that the Declaration and Bylaws granted the Board the authority to enact the subject rule banning television antennae on buildings.3

 

 

 

 

B. Was the Rule Reasonable?

 

 

 

 

Both parties agree that a condominium association rule will not withstand judicial scrutiny if it is not reasonable. This standard of review is supported by case law and legal commentary. See, e.g., Johnson v. Hobson, 505 A.2d 1313, 1317 (D.C. App. 1986); Hidden Harbour Estates, Inc. v. Norman, 309 So.2d 180, 182 (Fla.App. 1975); Note, Judicial Review of Condominium Rulemaking, 94 Harv.L.Rev. 647, 658 (1981) [hereinafter Harvard Note].4

 

The superior court found that roofmounted television antennae were one of a number of causes of leaking roofs. This finding has ample support in the record. The architect engaged by the Association to make recommendations as to what to do about the problem testified that television antennae caused problems on each of the twenty-two roofs in the condominium project.5 Other problems causing the leaking were age of the condominiums, their poor design, and problems of poor workmanship which went into the construction of the condominium buildings. He also testified that it was important to limit foot traffic on the roofs, as many owners were apparently causing damage to the roofs when walking there to adjust their antennae. The repairs to the roof cost the Association $155,000. These facts clearly justified the Board’s action to limit or prohibit television antennae and foot traffic on the roofs.

 

If the roof problems were the only justification for the rule, the O’Bucks would have a stronger argument that the rule was unreasonable. This is because they hired an architect who designed a method of installing antennae on the sides of the buildings rather than the roofs. This method would involve only brief work on the roof to connect the coaxial cable, and the rest of the work could be done from a ladder or hydraulically operated bucket. The availability of this relatively inexpensive alternative would cast some doubt on the reasonableness of a blanket prohibition on antennae if the only purpose of the rule was to protect the roofs.

 

However, it is clear that other legitimate considerations also motivated the antenna ban. As discussed above, the Declaration specifically authorized the prohibition of modifications or decorations to preserve a uniform exterior appearance to the buildings. Numerous witnesses testified that the Board was influenced by the unsightliness of the antennae. It was estimated that each of the 104 units in the twenty two buildings had an antenna protruding from the roof. Witnesses testified that the Board felt that the elimination of the forest of antennae combined with the availability of a state-of-the-art cable system would enhance the marketability of the units. This evidence is adequate to support the superior court’s conclusion that aesthetics and improved marketability were grounds for the antenna ban.

 

It is clear that the O’Bucks do not agree that the antenna ban improved the exterior appearance of the buildings. They describe this goal as “[nothing] more than a sop to personal prejudice or unarticulated personal values.” However, this is a facet of the freedom they sacrificed when they bought into a condominium association.

 

As one court put it:

 

 

[I]nherent in the condominium concept is the principle that to promote the health, happiness, and peace of mind of the majority of unit owners since they are living in such close proximity and using facilities in common, each unit owner must give up a certain degree of freedom of choice which he might otherwise enjoy in separate, privately owned property. Condominium unit owners comprise a little democratic sub-society of necessity more restrictive as it pertains to use of condominium property than may be existent outside the condominium organization.

 

 

Hidden Harbour Estates, 309 So.2d at 181-82, quoted in Johnson, 505 A.2d at 1317. We agree that condominium owners consciously sacrifice some freedom of choice in their decision to live in this type of housing. Unit owners may not rely on the courts to strike down reasonable rules on the grounds of differences in aesthetic tastes.

 

In evaluating the reasonableness of a condominium association rule, it is necessary to balance the importance of the rule’s objective against the importance of the interest infringed upon. In a case where a rule seriously curtails an important civil liberty – such as, for example, freedom of expression – we will look with suspicion on the rule and require a compelling justification. The antenna ban in the instant case curtails no significant interests. The only loss suffered is that the O’Bucks and the other owners must now pay a small monthly fee to receive television, and even this cost is offset to a degree by the savings from the lack of need to install and maintain an antenna. In some cases, we might consider a financial burden to be an important interest. However, the fee in this case is small in view of the wherewithal of the members of the Association.6 For this reason, we find that the interests of the Association in improving the exterior appearance of the buildings and enhancing the marketability of the units more than adequately justify the small financial burden placed on the owners.

 

… .

 

AFFIRMED.

 


    1. The Declaration and Bylaws charge the Board with the responsibility of passing such rules, within its discretion, in the best interests of the unit owners. This conclusion is reinforced by two other provisions which grant the Board authority over design and structural matters. Article IX, section 5 of the Declaration provides:

       

      No Unauthorized Additions, Alterations or Decorations. No additions, alterations or decorations to any common area, including those exterior common areas designated as limited common areas, shall be commenced, erected or maintained without the prior written approval of the Board of Directors as to the conformity and harmony of external design and location with existing structures in the project.

       

      Article VIII, section 1(h) of the Bylaws provides:

       

      Nothing shall be allowed, done or kept in any Unit or common areas of the Project which would overload or impair the floors, walls or roofs thereof, or cause any increase in the ordinary premium rates or the cancellation or invalidation of any insurance thereon maintained by or for the Association, nor shall any noxious or offensive activity or nuisance be made or suffered thereon.

 

    1. A 60% vote of the unit owners is required to amend the Declaration or Bylaws by article XIII, section 3 of the Declaration and by AS 34.07.020(13).

 

    1. The O’Bucks, the Association, and the superior court each rely to some extent on Carroll v. El Dorado Estates Division Number Two Ass’n, 680 P.2d 1158 (Alaska 1984), to support their positions. In that case, we summarily rejected an argument that the declaration granted a right to pet ownership which could not be revoked by the bylaws. We noted that the provision in the declaration “was specifically made conditional and subject to change.” Id. at 1162 n. 7. The Declaration in the instant case neither specifically grants nor specifically makes conditional a right to outdoor television antennae. Thus, Carroll has little if any bearing on this case. To the extent it applies, it shows that the O’Bucks have no vested property interest in maintaining their antenna, because any right to do so is subject to limitation or prohibition by the general regulatory provisions of the Declaration and Bylaws.

       

      The O’Bucks also rely on Winston Towers 200 Ass’n v. Saverio, 360 So.2d 470 (Fla.App. 1978). That case involved an attempted retroactive application of a rule banning pets and is plainly inapplicable to the instant case.

       

      The O’Bucks also argue that the decision to adopt the rule was procedurally flawed. However, they do not cite any provisions of the Declaration or Bylaws, any statutes, or any common law rules that were violated. Instead, they rely on one case study from a book on condominium associations to argue that the process should have been more participatory. See D. Wolfe, Condominium and Homeowner Associations that Work – On Paper and In Action 81-84 (1978). In the absence of appropriate factual basis and legal authority to support their position, we reject this contention.

 

    1. The Association urges an analogy to the business judgment rule of corporation law, which would require the court only to find that the Board’s rule was a “good faith exercise of business judgment.” Harvard Note, supra, at 664. This approach appears to be favored by what little commentary exists. See id. at 663-67. The O’Bucks resist this analogy, a position which is also supported by good authority. See Johnson, 505 A.2d at 1317 n. 7. However, it appears that there is little if any difference whether one uses the business judgment analogy in applying the reasonableness standard. See Harvard Note, supra, at 658-59, 667. The difference is certainly not material in this case, because the rule at issue measures up to any standard of reasonableness.

 

    1. The O’Bucks mischaracterize the testimony of the architect in their brief, where they write, “Gregg Strom, the architect who inspected the roofs on the Board’s behalf, testified that of approximately 100 antennae present on the roofs, only one of two [sic] might have caused problems.” It is clear from the testimony cited that Mr. Strom testified only that he had described with photographs on the witness stand only one or two antennae that were causing problems. He clarified this point even further on the following page of testimony, where he explained that these few photos were merely for illustrative purposes to show the Board the types of problems they faced, and not to indicate that these were the only antennae causing problems.

 

    1. The units were advertised at a cost of $97,000 in 1981.

 

 

 

Villa de las Palmas Homeowners Association v. Terifaj,

33 Cal.4th 73 (2004)

 

 

 

Law Office of Russell P. Nowell and Russell P. Nowell, Brea, for Defendant and Appellant.

 

Jeff Thom, Los Angeles, for California Council of the Blind as Amicus Curiae on behalf of Defendant and Appellant.

 

Fiore, Racobs & Powers, Peter E. Racobs, Riverside, and Margaret G. Wangler, Palm Desert, for Plaintiff and Respondent.

 

 

 

Moreno, J.

 

 

 

… .

 

 

 

 

I. FACTS AND PROCEDURAL HISTORY

 

 

 

 

Villa De Las Palmas is a relatively small condominium development consisting of 24 units located in a single L-shaped building. There are 12 units each on the top and bottom levels, and all units have either a small patio or a deck, with common walls separating them. The walls, described as “pony walls,” initially extend from the unit at full height, and then slope down. Many owners, including defendant Paula Terifaj, do not make Villa De Las Palmas, which is located in Palm Springs, their primary residence, but visit only periodically or seasonally.

 

The individual condominium units were conveyed to the original grantees in 1962 by recorded grant deeds that contained the development’s covenants, conditions, and restrictions, also commonly known as CC & R’s. Pursuant to the 1962 deed (Declaration), all grantees were required to execute a management agreement and “covenant and agree to observe, perform and abide by any and all lawful by-laws, rules, regulations and conditions with respect to the use and occupancy of said premises which may from time to time be adopted or prescribed by the Board of Governors constituted in said Management Agreement.” Failure to abide by any covenant or restriction in the Declaration could result in forfeiture, and “any owner or occupant of any apartment upon said premises may bring legal action for injunction and/or damages against said defaulting owner… .” The Declaration further provided that “[t]he benefits and obligations of this deed shall inure to and be binding upon the heirs … and assigns of the respective parties hereto.”

 

Pursuant to the authority granted in the Declaration, the Villa De Las Palmas Homeowners Association (the Association) adopted a rule prohibiting pets. The unrecorded rule provided: “Pets of any kind are forbidden to be kept in the apartment building or on the grounds at any time.” While the exact date of the adoption of the no-pet rule is unknown, it is undisputed that it was in existence when Terifaj purchased her unit. Terifaj, a veterinarian who purchased her unit in 1995, did not receive a written copy of the rule prohibiting pets, but she admitted at trial that she was aware of the no-pet rule when she purchased her unit.

 

Despite the prohibition on pets, from the time Terifaj purchased her unit until 1998, she visited her unit with her dog Lucy. When Lucy died in 1998, Terifaj acquired another dog, a female boxer, and brought her to the property. Terifaj attempted to have the Association amend the no-pet rule at the Association’s 1996 and 2000 general meetings, but was unsuccessful.

 

The Association repeatedly warned Terifaj that she was violating the rule prohibiting pets on the property and fined her accordingly. Terifaj, however, was undeterred and continued to bring her dog to the development. In response, in August 1999, the Association filed a complaint for injunctive and declaratory relief and nuisance, along with a motion for preliminary injunction, to compel Terifaj to abide by the no-pet rule. The trial court denied the motion for preliminary injunction in October 1999, ruling that it was not convinced the Association would prevail on the merits and that irreparable injury was not evident. The court ordered the case to nonbinding arbitration with a March 8, 2000, completion date.

 

In the interim between the denial of the preliminary injunction and the completion of arbitration, the members of the Association voted to amend the Declaration. In January 2000, the Association adopted and recorded the Amended and Restated Declaration of Covenants, Conditions and Restrictions (Amended Declaration), which added a no-pet restriction, providing: “No pets or animals of any kind, including without limitation, dogs, cats, birds, livestock, reptiles or poultry, may be kept or permitted in any Apartment or anywhere on the Property.” The Amended Declaration further provides that violations of the covenants and restrictions contained in the Amended Declaration are nuisances, and that such violations may be enjoined.

 

Based on the recorded Amended Declaration, the Association filed an amended complaint alleging the same causes of action and seeking the same relief as the original complaint. Following a bench trial, the trial court ruled in favor of the Association on all causes of action. It found the covenants and restrictions in the Amended Declaration to be enforceable equitable servitudes, granted a permanent injunction against any further violation of the no-pet restriction, and found the violation to be a nuisance. The court awarded the Association $15,000 in attorney fees.

 

The Court of Appeal affirmed. It concluded that section 1354 “[o]n its face … applies to any declaration, regardless of when it is adopted and recorded.” Because the no-pet restriction was in the recorded Amended Declaration, it therefore constituted an equitable servitude under section 1354, subdivision (a). Relying on Nahrstedt, which the Court of Appeal found governed review of the pet restriction, the court held the restriction was not unreasonable.

 

We granted Terifaj’s petition for review.

 

 

 

 

II. DISCUSSION

 

 

 

 

As a condominium project, Villa De Las Palmas is a common interest development subject to the provisions of the Davis-Stirling Common Interest Development Act (the Davis-Stirling Act or the Act). (§ 1350 et seq.) The Davis-Stirling Act, enacted in 1985 (Stats.1985, ch. 874, § 14, pp. 2774-2786), consolidated the statutory law governing condominiums and other common interest developments. Under the Act, a common interest development is created “whenever a separate interest coupled with an interest in the common area or membership in [an] association is, or has been, conveyed” and a declaration, a condominium plan, if one exists, and a final or parcel map are recorded.1 (§ 1352.) Common interest developments are required to be managed by a homeowners association (§ 1363, subd. (a)), defined as “a nonprofit corporation or unincorporated association created for the purpose of managing a common interest development” (§ 1351, subd. (a)), which homeowners are generally mandated to join (Nahrstedt, supra, 8 Cal.4th at p. 373, 33 Cal.Rptr.2d 63, 878 P.2d 1275).

 

The Act contains a fairly extensive definitions section, defining as relevant here “governing documents” and “declaration.” The declaration is defined as “the document, however denominated, which contains the information required by section 1353.” (§ 1351, subd. (h).) Section 1353 requires that declarations recorded on or after January 1, 1986, contain certain information, including the development’s covenants and restrictions. The governing documents encompass a broader category of documents, including “the declaration and any other documents, such as bylaws, operating rules of the association, articles of incorporation, or articles of association, which govern the operation of the common interest development or association.” (§ 1351, subd. (j).)

 

The declaration is often referred to as the development’s constitution (see Rest.3d Property, Servitudes, § 6.10, com. a, p. 196; 1 Hanna & Van Atta, Cal. Common Interest Developments: Law and Practice (2003) § 22:2, p. 1325) and “establish[es] a system of governance.” (Villa Milano Homeowners Association v. Il Davorge (2000) 84 Cal.App.4th 819, 827, 102 Cal.Rptr.2d 1.) Importantly, it contains the development’s covenants and restrictions, which are “enforceable equitable servitudes, unless unreasonable.” (§ 1354, subd. (a).) Several provisions of the Act allow for the amendment of the declaration. Of particular relevance here is section 1355, subdivision (b) (hereafter section 1355(b)), which provides in relevant part: “Except to the extent that a declaration provides by its express terms that it is not amendable, in whole or in part, a declaration which fails to include provisions permitting its amendment at all times during its existence may be amended at any time.”2

 

Terifaj’s argument is somewhat ambiguous with respect to enforcement of restrictions contained in amended declarations. She appears to argue that such restrictions are entirely unenforceable in any manner, but also maintains that such restrictions are not enforceable pursuant to section 1354, subdivision (a), because they do not meet the requirements of equitable servitudes. Since her argument is vague, we address both contentions.

 

Because we are construing provisions in the Davis-Stirling Act, we briefly recite the rules of statutory construction that will guide our decision. Our primary task in construing a statute is to ascertain the intent of the Legislature. (Peracchi v. Superior Court (2003) 30 Cal.4th 1245, 1253, 135 Cal.Rptr.2d 639, 70 P.3d 1054.) We make this determination by looking to the words used in the statute and giving them their plain meaning. (Smith v. Rae-Venter Law Group (2002) 29 Cal.4th 345, 358, 127 Cal.Rptr.2d 516, 58 P.3d 367.) ”‘“If there is no ambiguity in the language of the statute, ‘then the Legislature is presumed to have meant what it said.’”’” (Ibid.)

 

 

 

 

A.

 

 

 

 

We must first decide whether a use restriction contained in an amended declaration is enforceable against a homeowner who acquired his or her separate interest before the challenged amendment was adopted and recorded. As noted above, under the Davis-Stirling Act, a common interest development may amend its declaration pursuant to the provisions of the declaration itself or under the provisions of the Act. When a declaration is silent on whether it may be amended, section 1355(b) provides that it may be amended at any time. For the following reasons, we conclude that use restrictions added to a declaration by amendment bind not only subsequent purchasers, but current homeowners as well.

 

This conclusion follows from the plain language of section 1355(b), which provides in part: “For purposes of this subdivision, an amendment is only effective after (1) the proposed amendment has been distributed to all of the owners of separate interests in the common interest development by first-class mail postage prepaid or personal delivery not less than 15 days and not more than 60 days prior to any approval being solicited; (2) the approval of owners representing more than 50 percent … of the separate interests in the common interest development has been given, and that fact has been certified in a writing, executed and acknowledged by an officer of the association; and (3) the amendment has been recorded in each county in which a portion of the common interest development is located.” (Italics added.) Additionally, a copy of the recorded amendment must immediately be mailed or delivered to all homeowners.3 In short, the statute provides that an amendment is effective after notice of the proposed amendment is given to the homeowners, a majority of the homeowners approve the amendment, and the amendment is recorded. (1 Hanna & Van Atta, Cal Common Interest Developments: Law and Practice, supra, § 22:119, p. 1439; 9 Miller & Starr, Cal. Real Estate (3d ed.2001) § 25:133, pp. 302-303.)

 

Plainly read, any amendment duly adopted under this subdivision is effective against all homeowners, irrespective of when the owner acquired title to the separate interest or whether the homeowner voted for the amendment. (See, e.g., 1 Hanna & Van Atta, Cal Common Interest Developments: Law and Practice, supra, § 22:119, p. 1439; 9 Miller & Starr, Cal. Real Estate, supra, § 25:133, p. 308.) Terifaj’s argument that subsequently enacted amendments are not binding on current homeowners runs counter to section 1355(b)’s express language that an amendment is effective upon the satisfaction of the requirements enumerated in that provision. Neither section 1355(b) nor any other provision in the Davis-Stirling Act exempts from compliance with amendments to the declaration homeowners who purchased their individual units prior to the amendment.

 

That is not surprising. To allow a declaration to be amended but limit its applicability to subsequent purchasers would make little sense. A requirement for upholding covenants and restrictions in common interest developments is that they be uniformly applied and burden or benefit all interests evenly. (See, e.g., Nahrstedt, supra, 8 Cal.4th at p. 368, 33 Cal.Rptr.2d 63, 878 P.2d 1275 [restrictions must be “uniformly enforced”]; Rest.3d Property, Servitudes, § 6.10, com. f, p. 200.) This requirement would be severely undermined if only one segment of the condominium development were bound by the restriction. It would also, in effect, delay the benefit of the restriction or the amelioration of the harm addressed by the restriction until every current homeowner opposed to the restriction sold his or her interest. This would undermine the stability of the community, rather than promote stability as covenants and restrictions are intended to do.

 

Terifaj’s position would also, essentially, render meaningless the simple majority vote required for amendments to take effect under section 1355(b). Instead, unanimous consent would be needed, which would often be unattainable. The language of section 1355(b), however, makes clear that a simple majority is all that is required before an amendment becomes effective. One reason for this is because amendment provisions are designed to “prevent[] a small number of holdouts from blocking changes regarded by the majority to be necessary to adapt to changing circumstances and thereby permit the community to retain its vitality over time.” (Rest.3d Property, Servitudes, § 6.10, com. a, p. 196.)

 

Subjecting owners to use restrictions in amended declarations promotes stability within common interest developments. As we observed in Nahrstedt, “[u]se restrictions are an inherent part of any common interest development and are crucial to the stable, planned environment of any shared ownership arrangement.” (Nahrstedt, supra, 8 Cal.4th at p. 372, 33 Cal.Rptr.2d 63, 878 P.2d 1275.) Such restrictions may “preclude alteration of building exteriors, limit the number of persons that can occupy each unit, and place limitations on – or prohibit altogether – the keeping of pets. [Citations.]” (Id. at p. 373, 33 Cal.Rptr.2d 63, 878 P.2d 1275.) We explained that a homeowners association, “through an elected board of directors, is empowered … to enact new rules governing the use and occupancy of property within the [development].” (Ibid.) We further observed that “anyone who buys a unit in a common interest development with knowledge of its owners association’s discretionary power accepts ‘the risk that the power may be used in a way that benefits the commonality but harms the individual.’” (Id., at p. 374, 33 Cal.Rptr.2d 63, 878 P.2d 1275, quoting Natelson, Consent, Coercion, and “Reasonableness” in Private Law: The Special Case of the Property Owners Association (1990) 51 Ohio State L.J. 41, 67.) A prospective homeowner who purchases property in a common interest development should be aware that new rules and regulations may be adopted by the homeowners association either through the board’s rulemaking power or through the association’s amendment powers. (See, e.g., Randolph, Changing the Rules: Should Courts Limit the Power of Common Interest Communities to Alter Unit Owners’ Privileges in the Face of Vested Expectations? (1998) 38 Santa Clara L.Rev. 1081, 1126 [“There is no basis to argue that purchasers of units within common interest communities have an expectation that there will be no changes at all.”].)

 

Finally, section 1355(b)’s legislative history supports the conclusion that all homeowners are bound by amendments adopted and recorded subsequent to purchase. (Jarrow Formulas, Inc. v. LaMarche (2003) 31 Cal.4th 728, 736, 3 Cal.Rptr.3d 636, 74 P.3d 737 [court “may observe that available legislative history buttresses a plain language construction”].) Subdivision (b) of section 1355 was not part of the bill enacting the Davis-Stirling Act, but was added three years later in 1988. (Stats.1988, ch. 1409, § 1, p. 4776 [Assem. Bill No. 4426].)4 An enrolled bill report from the Department of Real Estate states that “[m]embers of a homeowners’ association … should not forever be saddled with provisions they desire to change.” (Cal. Dept. of Real Estate, Enrolled Bill Rep. on Assem. Bill No. 4426 (1987-1988 Reg. Sess.) Aug. 29, 1988, p. 1.) Significantly, the report recommended approval of Assembly Bill No. 4426, despite acknowledging that current homeowners may have relied on the restrictions in place at the time they made their purchase, stating: “The failure to include a provision for amendment may indicate an intentional omission. Additionally, some changes may provide for inconsistent uses which were not previously permissible. Many owners may have acquired their interest in the subdivision because of such a restriction limiting use. To permit an amendment would affect their reasonable expectations.” (Enrolled Bill Rep. on Assem. Bill No. 4426, supra, p. 2.) The Legislature was thus aware that amendments could affect settled or reasonable expectations of some homeowners, but it did not limit the language of section 1355(b) to exempt those homeowners from subdivision (b)’s operation. Tellingly, nothing in the text of section 1355(b) indicates the Legislature intended only subsequent purchasers or homeowners who voted for an amendment to be bound by a use restriction so enacted.

 

Section 1355(b)’s express language and the limited legislative history compel the conclusion that all homeowners are bound by amendments made to a declaration pursuant to that section. Accordingly, we conclude that all homeowners are subject to use restrictions contained in amended declarations irrespective of when the amendment was passed.

 

 

 

 

B.

 

 

 

 

To enforce the no-pet restriction in the Amended Declaration, the Association sought injunctive relief under section 1354, subdivision (a) (hereafter section 1354(a)), which provides in relevant part: “The covenants and restrictions in the declaration shall be enforceable equitable servitudes, unless unreasonable.”5 Terifaj contends that even if subsequently enacted use restrictions promulgated pursuant to section 1355(b) and recorded after a homeowner has purchased property in the development are binding on those homeowners, equitable relief under section 1354(a) is nonetheless unavailable to the homeowners association to enforce such restrictions.

 

Equitable relief, maintains Terifaj, may not be granted under section 1354(a) in this case because that section requires that a use restriction constitute an equitable servitude in order to be enforceable through injunctive relief.6 She cites our decision in Citizens for Covenant Compliance v. Anderson (1995) 12 Cal.4th 345, 47 Cal.Rptr.2d 898, 906 P.2d 1314 for the applicable California law on equitable servitudes, which she contends is incorporated in section 1354(a). She maintains the no-pet restriction in this case did not meet the requirements of equitable servitudes, in part, because it was not contained in a document recorded prior to her purchase of a unit in the development, and she did not have notice of the restriction when she purchased the property.

 

The Association counters that section 1354(a) applies to all restrictions and covenants in the development’s recorded declaration, original or amended, and relies primarily on the Court of Appeal’s conclusion that section 1354(a) facially applies to any declaration. The Association contends, and the Court of Appeal concluded, that use restrictions in amended declarations are equitable servitudes because section 1354(a) makes no distinction between restrictions contained in the original declaration and those added to the declaration through amendment. We agree with the Association that section 1354(a) facially applies to all covenants and restrictions in the declaration, irrespective of when such covenants and restrictions were incorporated into the declaration.

 

The text of section 1354(a) belies Terifaj’s contention that covenants and restrictions must meet the common law requirements of equitable servitudes before they may be enforced against a current homeowner. That section does not provide that covenants and restrictions are enforceable only if they meet the common law requirements of equitable servitudes, but clearly provides that covenants and restrictions in the declaration ”shall be enforceable equitable servitudes, unless unreasonable” and shall bind all owners. (§ 1354(a), italics added.) This language could mean one of two things, both of which undermine Terifaj’s contention. Such restrictions are deemed to be equitable servitudes notwithstanding their failure to meet the technical requirements of equitable servitudes; that is, the Legislature has made such restrictions enforceable equitable servitudes by virtue of their inclusion in the declaration. Or, such restrictions may simply be enforceable in the same manner as equitable servitudes, with equitable remedies available to the Association, including injunctive relief. Either reading precludes the conclusion that the Legislature intended to incorporate the technical requirements of equitable servitudes into the statute. This interpretation appears compelled by the observation that accepting Terifaj’s position would, in effect, nullify the amendment provisions in the Davis-Stirling Act because homeowners could argue, as does Terifaj here, that they did not have notice of the particular use restriction enacted pursuant to those provisions. A homeowners association, thus, would be unable to seek injunctive relief to compel a complaining homeowner to comply with duly promulgated restrictions pursuant to section 1355(b). We do not think the Legislature intended such an anomalous result.

 

We therefore agree with the Court of Appeal that section 1354(a) governs enforcement of an amendment to a declaration because that section does not distinguish between an original and an amended declaration. The Legislature, by using expansive language in section 1354(a), intended all covenants and restrictions in the declaration to be enforceable against all homeowners under that provision. Only if the covenant or restriction in question is unreasonable will it be unenforceable under section 1354(a).

 

Accordingly, we conclude that section 1354(a) applies to enforcement actions relating not only to the covenants and restrictions in the original declaration, but also covenants and restrictions in any declaration.7 We are left then with the issue whether the deferential Nahrstedt standard of presumptive reasonableness applies to use restrictions adopted and recorded after a challenging homeowner has purchased his or her individual interest.

 

 

 

 

C.

 

 

 

 

We interpreted section 1354(a) in Nahrstedt, supra, 8 Cal.4th 361, 33 Cal.Rptr.2d 63, 878 P.2d 1275, and held, pursuant to principles distilled from various authorities and the text of section 1354(a), that covenants and restrictions in recorded declarations of common interest developments are presumptively reasonable (Nahrstedt, supra, at p. 380, 33 Cal.Rptr.2d 63, 878 P.2d 1275), and are enforceable “unless they are wholly arbitrary, violate a fundamental public policy, or impose a burden on the use of affected land that far outweighs any benefit” (id. at p. 382, 33 Cal.Rptr.2d 63, 878 P.2d 1275).

 

In articulating the judicial standard of review to be applied to such restrictions, we relied on the language of section 1354(a) and noted that the prior version of section 1354(a) provided that covenants and restrictions in recorded declarations “‘shall be enforceable equitable servitudes where reasonable’” (Nahrstedt, supra, 8 Cal.4th at p. 380, 33 Cal.Rptr.2d 63, 878 P.2d 1275; former § 1355 [Stats.1963, ch. 860, § 3, p. 2092]), and that the Legislature’s use of the double negative “unless unreasonable” in the current version of the statute “cloaked use restrictions contained in a condominium development’s recorded declaration with a presumption of reasonableness by shifting the burden of proving otherwise to the party challenging the use restriction.” (Nahrstedt, supra, 8 Cal.4th at p. 380, 33 Cal.Rptr.2d 63, 878 P.2d 1275.)

 

The Association contends Nahrstedt’s deferential standard applies to subsequently adopted and recorded use restrictions incorporated into a development’s declaration. Terifaj disagrees, emphasizing that our conclusion in Nahrstedt was based on the fact that the use restriction in that case was contained in a declaration recorded prior to the homeowner’s purchase, and relies on our reasoning that “giving deference to use restrictions contained in a condominium project’s originating documents protects the general expectations of condominium owners ‘that restrictions in place at the time they purchase their units will be enforceable.’ (Note, Judicial Review of Condominium Rulemaking [(1981)] 94 Harv. L.Rev. 647, 653; Ellickson, Cities and Homeowners’ Associations (1982) 130 U.Pa. L.Rev. 1519, 1526-1527 [stating that association members ‘unanimously consent to the provisions in the association’s original documents’ and courts therefore should not scrutinize such documents for ‘reasonableness’].)” (Nahrstedt, supra, 8 Cal.4th at p. 377, 33 Cal.Rptr.2d 63, 878 P.2d 1275.)

 

In Nahrstedt, supra, 8 Cal.4th 361, 33 Cal.Rptr.2d 63, 878 P.2d 1275, the homeowner, who had three indoor cats, sought to prevent the condominium homeowners association from enforcing a no-pet restriction against her because, she contended, her cats did not make noise and were not a nuisance (id. at p. 367, 33 Cal.Rptr.2d 63, 878 P.2d 1275), and she had been unaware of the restriction when she purchased her unit (id. at p. 369, 33 Cal.Rptr.2d 63, 878 P.2d 1275). Applying the deferential standard, we held the no-pet restriction was enforceable because the homeowner failed to meet the burden placed on her, as the party challenging the restriction, to show that the restriction was “unreasonable.” (Id. at p. 389, 33 Cal.Rptr.2d 63, 878 P.2d 1275.)

 

Unlike in this case, Nahrstedt involved a pet restriction contained in a development’s originating declaration that was recorded prior to the challenging homeowner’s purchase, a fact we emphasized throughout our discussion. Because of that factual difference, much of reasoning in that decision is not necessarily relevant to the resolution of this case. However, Nahrstedt does contain reasoning that arguably supports the conclusion that subsequently enacted and recorded use restrictions should receive greater judicial scrutiny. We observed in Nahrstedt that other jurisdictions, “lacking … legislative guidance,” applied some form of reasonableness analysis to use restrictions in common interest developments. Significantly, we noted that some courts applied “the ‘reasonableness’ standard only to those restrictions adopted by majority vote of the homeowners or enacted under the rulemaking power of an association’s governing board, and would not apply this test to restrictions included in a planned development project’s recorded declaration or master deed.” (Nahrstedt, supra, 8 Cal.4th at p. 376, 33 Cal.Rptr.2d 63, 878 P.2d 1275.)

 

We discussed, in particular, Hidden Harbour Estates v. Basso (Fla.Dist.Ct.App.1981) 393 So.2d 637 (Basso), in which a Florida appellate court delineated two categories of restrictions – those found in the development’s declaration and those later promulgated by an association’s board of directors. Restrictions found in the development’s declaration are “clothed with a very strong presumption of validity which arises from the fact that each individual unit owner purchases his unit knowing of and accepting the restrictions to be imposed,” while restrictions in the second category are subjected to a reasonableness analysis. (Id. at pp. 639-640; Nahrstedt, supra, at pp. 376-377, 33 Cal.Rptr.2d 63, 878 P.2d 1275.) Basso imposed a reasonableness analysis to rules promulgated by a board of directors or decisions by the board denying a certain use when the decision falls within the board’s authority, explaining the reason for the more stringent standard is “to somewhat fetter the discretion of the board of directors.” (Basso, supra, at p. 640.) While the Basso court spoke of restrictions in the declaration, without distinguishing the original declaration from restrictions subsequently adopted through amendment, the reference to “each individual unit owner” purchasing with knowledge “of and accepting the restrictions to be imposed” (id. at p. 639), makes clear that the court was referring to the founding declaration or one in existence at the time of purchase.

 

We also discussed Noble v. Murphy (1993) 34 Mass.App.Ct. 452, 612 N.E.2d 266. In that case, the original recorded bylaws of a condominium development incorporated the development’s rules and regulations, which included a no-pet rule. (Id. at p. 270.) In the course of upholding the pet restriction, which had been added to the recorded bylaws prior to the challenging homeowner’s purchase of a unit, the court stated that “[a] condominium use restriction appearing in originating documents which predate the purchase of individual units may be subject to even more liberal review than if promulgated after units have been individually acquired.” (Ibid.; Nahrstedt, supra, 8 Cal.4th at p. 377, 33 Cal.Rptr.2d 63, 878 P.2d 1275.)

 

Based on this discussion and because we explained that our interpretation of section 1354(a) was consistent with “judicial decisions in other jurisdictions that have applied a presumption of validity to the recorded land use restrictions of a common interest development” (Nahrstedt, supra, 8 Cal.4th at p. 382, 33 Cal.Rptr.2d 63, 878 P.2d 1275, citing Noble and Basso), we have acknowledged that “some of our reasoning arguably suggested a distinction between originating [covenants and restrictions] and subsequently promulgated use restrictions.” (Lamden v. La Jolla Shores Clubdominium Homeowners Association (1999) 21 Cal.4th 249, 264, 87 Cal.Rptr.2d 237, 980 P.2d 940.) Our discussion of Basso and Noble suggests that we would not necessarily apply the same deferential standard to subsequently enacted use restrictions. For the reasons that follow, however, we conclude that subsequently promulgated and recorded use restrictions are entitled to the same judicial deference accorded covenants and restrictions in original declarations; that is, they are presumptively valid, and the burden of proving otherwise rests upon the challenging homeowner.

 

Although we discussed and seemingly approved of the distinction drawn in Basso between restrictions in the original declaration and those subsequently adopted, we did not hold or state in Nahrstedt that we were adopting such an approach. Instead we prefaced our discussion of Basso and Noble with the caveat that those decisions were from “states lacking … legislative guidance.” (Nahrstedt, supra, 8 Cal.4th at p. 376, 33 Cal.Rptr.2d 63, 878 P.2d 1275.) We, however, have been provided guidance by our Legislature through the Davis-Stirling Act, and as the Court of Appeal observed, the statutory language is “controlling.” Section 1354(a) unambiguously refers to the “declaration” and provides that the covenants and restrictions in the declaration are equitable servitudes that are enforceable unless unreasonable. It further provides that the covenants and restrictions shall bind all owners of separate interests. (§ 1354(a).) We have previously construed the phrase “unless unreasonable” in section 1354(a) to mean that restrictions in a declaration are enforceable unless they are arbitrary, violate public policy, or impose a burden on the land that outweighs any benefits. (Nahrstedt, supra, 8 Cal.4th at p. 389, 33 Cal.Rptr.2d 63, 878 P.2d 1275.) This interpretation was governed by the Legislature’s use of the double negative “unless unreasonable” in place of the previous phrase “where reasonable.” (Id. at p. 380, 33 Cal.Rptr.2d 63, 878 P.2d 1275.)

 

While our interpretation was consistent with Basso, Basso was not the primary basis for our holding – the statutory language was. As we concluded, “[i]n section 1354, the Legislature has specifically addressed the subject of the enforcement of use restrictions that, like the one in this case prohibiting the keeping of certain animals, are recorded in the declaration of a condominium or other common interest development. The Legislature has mandated judicial enforcement of those restrictions unless they are shown to be unreasonable when applied to the development as a whole.” (Nahrstedt, supra, 8 Cal.4th at pp. 388-389, 33 Cal.Rptr.2d 63, 878 P.2d 1275, italics added.)

 

Nor did Nahrstedt imply that we would apply a more stringent standard, such as objective reasonableness, to restrictions in recorded amended declarations, as opposed to unrecorded use restrictions promulgated by a board of directors of a homeowners association or other unrecorded rules and regulations. (E.g., Lamden v. La Jolla Shores Clubdominium Homeowners Association, supra, 21 Cal.4th at p. 264, 87 Cal.Rptr.2d 237, 980 P.2d 940; Rancho Santa Fe Association v. Dolan-King (2004) 115 Cal.App.4th 28, 38 & fn. 2, 8 Cal.Rptr.3d 614.)

 

Moreover, there is no language in section 1355(b) that indicates a different standard for enforcing its provisions should, or may, apply. (California Fed. Savings & Loan Assn. v. City of Los Angeles (1995) 11 Cal.4th 342, 349, 45 Cal.Rptr.2d 279, 902 P.2d 297 [“It is our task to construe, not to amend, the statute.”].) Once the declaration is amended and recorded, section 1354(a) governs its enforcement, and hence, amendments are enforceable unless unreasonable. Had the Legislature intended a different standard to apply to subsequently adopted and recorded use restrictions than applies to restrictions in the original declaration, it would have so provided.

 

… .

 

 

 

 

D.

 

 

 

 

Applying the deferential Nahrstedt standard of review to the Amended Declaration in this case, we hold, as we did in Nahrstedt, that the recorded restriction prohibiting pets is not unreasonable as a matter of law.8 Terifaj, however, contends that a subsequent amendment to the Davis-Stirling Act, providing in relevant part that “no governing documents shall prohibit the owner of a separate interest … from keeping at least one pet” (§ 1360.5, added by Stats.2000, ch. 551, § 2 [Assem. Bill No. 860]), calls into question Nahrstedt’s ultimate holding that the no-pet restriction in that case was not unreasonable. Section 1360.5, however, does not aid Terifaj. As the Court of Appeal observed, subdivision (e) of section 1360.5 clearly provides that its provisions “shall only apply to governing documents entered into, amended, or otherwise modified on or after [January 1, 2001].” The Declaration in this case was amended and recorded in January 2000, a year prior to section 1360.5’s operative date. To allow section 1360.5 to undermine Nahrstedt’s holding in this case would essentially render section 1360.5’s operative date meaningless. Any homeowner could challenge a recorded no-pet restriction on the basis of section 1360.5 without regard to its effective date.

 

Moreover, the fact that the Legislature has passed section 1360.5 does not undermine our conclusion in Nahrstedt that a restriction prohibiting pets may be reasonable. By enacting section 1360.5, the Legislature did not declare that prohibiting pets is unreasonable, but merely demonstrated a legislative preference for allowing homeowners in common interest developments to keep at least one pet. As we observed in Nahrstedt, prohibiting pets is “rationally related to health, sanitation and noise concerns legitimately held by residents” of common interest developments. (Nahrstedt, supra, 8 Cal.4th at p. 386, 33 Cal.Rptr.2d 63, 878 P.2d 1275.) While Nahrstedt involved a “high-density” project, the concerns expressed in that case apply equally to the present case, which involves a smaller development. Therefore, nothing in section 1360.5 undermines Nahrstedt’s holding that a no-pet restriction may be reasonable given the characteristics of common interest developments such as condominium projects.

 

… .

 


    1. Although Villa De Las Palmas was created prior to the enactment of the Davis-Stirling Act, the Act applies to common interest developments in existence prior to its enactment. (§ 1352; Nahrstedt, supra, 8 Cal.4th at p. 378, fn. 8, 33 Cal.Rptr.2d 63, 878 P.2d 1275.)

 

    1. In addition to section 1355(b), the Davis-Stirling Act provides several methods for amending the declaration. Section 1355, subdivision (a), provides that a declaration may be amended pursuant to its own amendment provisions or pursuant to other provisions of the Act; section 1356 allows a homeowners association to petition the court for approval of an amendment if the declaration provides for a larger majority than the association is able to muster, provided at least 50 percent of the owners vote in favor of the proposed amendment; section 1355.5 provides for the deletion of certain developer-oriented provisions; section 1357 provides for the extension of a termination date set forth in a declaration.

 

    1. Section 1355(b) provides in full: “Except to the extent that a declaration provides by its express terms that it is not amendable, in whole or in part, a declaration which fails to include provisions permitting its amendment at all times during its existence may be amended at any time. For purposes of this subdivision, an amendment is only effective after (1) the proposed amendment has been distributed to all of the owners of separate interests in the common interest development by first-class mail postage prepaid or personal delivery not less than 15 days and not more than 60 days prior to any approval being solicited; (2) the approval of owners representing more than 50 percent, or any higher percentage required by the declaration for the approval of an amendment to the declaration, of the separate interests in the common interest development has been given, and that fact has been certified in a writing, executed and acknowledged by an officer of the association; and (3) the amendment has been recorded in each county in which a portion of the common interest development is located. A copy of any amendment adopted pursuant to this subdivision shall be distributed by first-class mail postage prepaid or personal delivery to all of the owners of separate interest immediately upon its recordation.”

 

    1. Section 1355(b) initially contained a sunset provision with a termination date of January 1, 1990. In 1993, the Legislature amended the subdivision by deleting the sunset provision. (§ 1355(b), as amended by Stats.1993, ch. 21, § 1, pp. 134-135.) Section 1355(b), therefore, was inoperative between January 1, 1990 and January 1, 1994.

 

    1. In full, section 1354(a), provides: “The covenants and restrictions in the declaration shall be enforceable equitable servitudes, unless unreasonable, and shall inure to the benefit of and bind all owners of separate interests in the development. Unless the declaration states otherwise, these servitudes may be enforced by any owner of a separate interest or by the association, or by both.”

 

    1. Section 1354(a) is found in article 2 of the Davis-Stirling Act, which is entitled “Enforcement.”

 

    1. Because the Association amended the Declaration pursuant to section 1355(b) and filed an amended complaint based on the newly enacted and recorded no-pet restriction, we need not decide in this case whether the Association would have been entitled to equitable relief based on Terifaj’s violation of the unrecorded no-pet rule passed pursuant to the 1962 Declaration.

 

    1. We do not quarrel with Terifaj about the benefits of pet ownership, but that is not the issue in this case. The primary issue in this case is whether subsequently enacted and recorded use restrictions may be enforced against a current homeowner.

 

 

 

Newman v. Grandview at Emerald Hills, Inc.,

861 So. 2d 494 (Fl. Dist. Ct. App. 2003).

 

 

 

Usher Bryn, Aventura, for appellants.

 

Geoffrey B. Marks of Billbrough & Marks, P.A., Coral Gables, for appellee.

 

 

 

Warner, J.

 

We deny the motion for rehearing, withdraw our previously issued opinion, and substitute the following in its place.

 

The issue presented in this case is whether a condominium association rule banning the holding of religious services in the auditorium of the condominium constitutes a violation of section 718.123, Florida Statutes (2002), which precludes condominium rules from unreasonably restricting a unit owner’s right to peaceably assemble. We hold that the rule does not violate the statute and affirm.

 

Appellee Grandview is a condominium association with 442 members, appellants being two of the members. Appellants reside at Grandview condominium during the winter months. The common elements of the condominium include an auditorium that members can reserve for social gatherings and meetings. Grandview enacted a rule governing the use of the auditorium in 1982, which provided that the auditorium could be used for meetings or functions of groups, including religious groups, when at least eighty percent of the members were residents of Grandview condominium. Generally, the only reservations made for the auditorium on Saturdays were by individual members for birthday or anniversary celebrations.

 

In January 2001, several unit owners reserved the auditorium between 8:30 and noon on Saturday mornings. While they indicated they were reserving it for a party, they actually conducted religious services. Approximately forty condominium members gathered for the services.

 

Upon discovering that religious services were being conducted on Saturdays in the auditorium, several other members complained to the Board of Directors (“Board”). The Board met in February to discuss restrictions on the use of the auditorium and common elements for religious services and activities. The meeting became very confrontational between those members supporting the use of the auditorium for religious services and those opposing such use. Based upon the controversial nature of the issue, the Board’s desire not to have a common element tied up for the exclusive use of a minority of the members on a regular basis, and to avoid conflicts between different religious groups competing for the space, the Board first submitted the issue to a vote of the owners. Seventy percent of the owners voted in favor of prohibiting the holding of religious services in the auditorium. The Board then voted unanimously to amend the rule governing the use of the auditorium. The new rule provided that “[n]o religious services or activities of any kind are allowed in the auditorium or any other common elements.”

 

Appellants filed suit against Grandview seeking injunctive and declaratory relief to determine whether the rule violated their constitutional rights or was in violation of section 718.123, and whether the rule was arbitrarily and capriciously enacted by the Board. Grandview answered, denying that the rule was arbitrary or violated appellants’ statutory or constitutional rights. Appellants moved for a temporary injunction alleging that Grandview was not only preventing the owners from holding religious services, it was also prohibiting the use of the auditorium for holiday parties, including Christmas and Chanukah, based upon its prohibition against using the common elements “for religious activities of any kind.” The court granted the motion as to the use of the auditorium for religious activities of any kind but denied it as it applied to the holding of religious services. Based upon the temporary injunction as to religious activities, Grandview amended its rule to limit the prohibition to the holding of religious services in the auditorium.

 

At a hearing on appellants’ motion for a permanent injunction against the rule, the appellants relied primarily on section 718.123, which prohibits condominium associations from unreasonably restricting the unit owners’ rights to peaceable assembly. They argued that religious services fell into the category of a “peaceable assembly,” and a categorical ban on the holding of religious services was per se unreasonable. Grandview maintained that it had the right to restrict the use of its common elements. Because the right of peaceable assembly did not mandate a right to conduct religious services, it had the right to poll its members and restrict the use based upon the majority’s desires. As such, Grandview maintained the exercise of this right was reasonable.

 

In its final order denying the injunction, the court determined that because no state action was involved, the unit owners’ constitutional rights of freedom of speech and religion were not implicated by Grandview’s rule. The court determined that the rule did not violate section 718.123, as the condominium association had the authority to enact this reasonable restriction on the use of the auditorium. Appellants challenge that ruling.

 

Chapter 718, Florida’s “Condominium Act,” recognizes the condominium form of property ownership and “establishes a detailed scheme for the creation, sale, and operation of condominiums.” Woodside Vill. Condo. Ass’n v. Jahren, 806 So.2d 452, 455 (Fla.2002). Thus, condominiums are strictly creatures of statute. See id. The declaration of condominium, which is the condominium’s “constitution,” creates the condominium and “strictly governs the relationships among the condominium units owners and the condominium association.” Id. at 456. Under the declaration, the Board of the condominium association has broad authority to enact rules for the benefit of the community. See id.

 

In Hidden Harbour Estates, Inc. v. Norman, 309 So.2d 180, 181-82 (Fla. 4th DCA 1975), this court explained the unique character of condominium living which, for the good of the majority, restricts rights residents would otherwise have were they living in a private separate residence:

 

 

It appears to us that inherent in the condominium concept is the principle that to promote the health, happiness, and peace of mind of the majority of the unit owners since they are living in such close proximity and using facilities in common, each unit owner must give up a certain degree of freedom of choice which he might otherwise enjoy in separate, privately owned property. Condominium unit owners comprise a little democratic sub society of necessity more restrictive as it pertains to use of condominium property than may be existent outside the condominium organization.

 

 

Section 718.123(1) recognizes the right of the condominium association to regulate the use of the common elements of the condominium:

 

 

All common elements, common areas, and recreational facilities serving any condominium shall be available to unit owners in the condominium or condominiums served thereby and their invited guests for the use intended for such common elements, common areas, and recreational facilities, subject to the provisions of s. 718.106(4). The entity or entities responsible for the operation of the common elements, common areas, and recreational facilities may adopt reasonable rules and regulations pertaining to the use of such common elements, common areas, and recreational facilities. No entity or entities shall unreasonably restrict any unit owner’s right to peaceably assemble or right to invite public officers or candidates for public office to appear and speak in common elements, common areas, and recreational facilities.

 

 

(Emphasis added).

 

The statutory test for rules regarding the operation of the common elements of the condominium is reasonableness. The trial court found the rule preventing use of the auditorium for religious services was reasonable in light of the Board’s concern for a serious potential for conflict of use which could arise among competing religious groups. Having polled the members and determined that a majority of the members approved the ban, the Board’s rule assured that the auditorium was “available to unit owners in the condominium or condominiums served thereby and their invited guests for the use intended” in accordance with the statute. s 718.123(1).

 

The appellants’ main argument both at trial and on appeal suggests that because the statute mandates that the Board may not “unreasonably restrict any unit owner’s right to peaceably assemble,”s 718.123(1), a categorical prohibition of all religious services exceeds the Board’s powers, as the right to meet in religious worship would constitute the right to peaceably assemble. However, the right to peaceably assemble has traditionally been interpreted to apply to the right of the citizens to meet to discuss public or governmental affairs. See United States v. Cruikshank, 92 U.S. 542, 551-52, 23 L.Ed. 588 (1875). Assuming for purposes of this argument that the right to gather for religious worship is a form of peaceable assembly, the rule in question bans this particular form of assembly, but not all right to assemble. Certainly, a categorical ban on the right of members to use the auditorium for any gathering would be contrary to statute. However, the statute itself permits the reasonable regulation of that right. Prohibiting those types of assembly which will have a particularly divisive effect on the condominium community is a reasonable restriction. See Hidden Harbour, 309 So.2d at 181-82. The Board found that permitting the holding of regular worship services and the competition among various religious groups for use of the auditorium would pose such conflict. Where the condominium association’s regulations regarding common elements are reasonable and not violative of specific statutory limitations, the regulations should be upheld. See Juno By the Sea N. Condo. Ass’n v. Manfredonia, 397 So.2d 297, 302 (Fla. 4th DCA 1980). The trial court found the restriction reasonable under the facts. No abuse of discretion has been shown.

 

The judgment of the trial court is affirmed.

 

 

 

Stone and Stevenson, JJ., concur.

 

Paula A. Franzese, Privatization and Its Discontents: Common Interest Communities and the Rise of Government for “The Nice”, Urban Lawyer, Summer, 2005:

 

Abstract: This article explores the phenomenon of privatization, or the shift from government provision of services to provision by the private sector, in the context of privatized neighborhoods. The proliferation of gated and walled communities, together with the significant rise of homeowners associations, contribute to patterns of homogeneity, conformity and exclusion that can yield dangerous consequences. Cultures of litigiousness, fear of the “other,” civic alienation and resident dissatisfaction are among the by-products of these common interest communities’ zealous pursuit of “the nice” place to live.

 

Download at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=871289.

 

Julian Emerson, Housing complex owners vote to ban smoking, Leader Telegram (Eau Claire, Wisconsin, July 19, 2009)

 

 

 

It’s not just indoor public places in Eau Claire where lighting up is prohibited. Now residents of a south side, owner-occupied housing complex will have to snuff out smoking in their homes, the most recent sign of public anti-smoking sentiment.

 

Members of the Fairfax Parkside Homeowners Association on Wednesday voted to outlaw smoking inside residences that are part of the 34-unit development. The ban also prohibits smoking in shared spaces, such as porches and garages, but does allow it in yards and on patios.

 

Of the 19 association members who voted on the issue, 15 favored the anti-smoking regulation proposed by association President Dave Hanvelt, while four argued that residents should be allowed to smoke in their homes.

 

“This doesn’t restrict a smoker from living here,” Hanvelt said of the smoking prohibition. “It just means that there are restrictions on where they can smoke.”

 

Fairfax Parkside is believed to be the first Eau Claire development in which homeowners aren’t allowed to light up indoors.

 

”I’m not aware of any other instances where that is the case,” said Julie Marlette, coordinator of the Tobacco Free Partnership of Eau Claire County.

 

The adoption of the indoor anti-smoking rule likely won’t impact many Fairfax Parkside homeowners, as Hanvelt said he doesn’t know of any smokers in the development. But it does restrict future homeowners there from smoking, and visitors also won’t be allowed to smoke inside.

 

“You don’t want to have to worry about your non-smoking neighbor moving out and a smoker moving in,” he said.

 

Hanvelt proposed the regulation earlier this year because homeowners in the development own twin homes, or each side of a duplex-style home. Because of their close proximity, smoke from one unit could flow into the one next door.

 

“If we all lived in separate units, this wouldn’t have been necessary,” Hanvelt said, noting homeowners association members made sure to allow outdoor smoking so as to not be too restrictive.

 

The Fairfax Parkside regulation marks an extension of non-smoking rules from public places to private residences. Last year the Eau Claire City Council approved a controversial ban on smoking in indoor public places, including taverns.

 

The issue prompted heated response from people on both sides of the issue, and opponents were concerned that the ban could open the door to prohibitions on smoking in people’s homes.

 

Word of the smoking restriction enacted at Fairfax Parkside has some people fuming.

 

“We worried that this might happen, and now it appears that it has,” said Sally Jo Birtzer, a nonsmoker who is president of the Eau Claire City-County Tavern League and general manager of Wagner’s Lanes. “As long as tobacco is a legal product, people should be allowed to smoke it in their own homes.”

 

While preventing smoking in privately owned homes is unusual, prohibiting the practice in rental residences isn’t unheard of in Eau Claire and elsewhere. Some landlords don’t allow renters to smoke indoors in an effort to keep those living quarters cleaner and to reduce the chances of a house fire.

 

Stomping out smoking in multifamily rental units is a growing trend in other parts of the U.S., Marlette said.

 

“I think people are recognizing the exposure that is occurring to secondhand smoke in multiunit housing,” she said. “It is definitely a bona fide health issue, and I think we’re going to see more requests for those units to go smoke free.”

 

Dave FitzGerald, one of the Fairfax Parkside developers who also lives there, initially questioned whether the non-smoking measure would hinder future sales in an already tough housing market. But FitzGerald, a nonsmoker, said the anti-smoking rule could attract buyers too, especially given that nearly four of every five people don’t smoke.

 

“Could we lose a sale to somebody who is a smoker? Certainly,” FitzGerald said. “But I think there is a better chance of having somebody be willing to live here because there isn’t any smoking.”

 

Hanvelt knows firsthand the frustrations of living next to a smoker in a shared-space residence. He previously spent thousands of dollars at a former residence retrofitting his unit to prevent cigarette smoke from a next-door neighbor from making its way to his home, but the effort proved unsuccessful, he said.

 

Now he looks forward to living in a smoke-free environment.

 

“We adopted this for our own safety and health,” Hanvelt said. “This is a very nice place to live, and we want to keep it that way.”

 

 

 

Paula A. Franzese, Privatization and Its Discontents: Common Interest Communities and the Rise of Government for “The Nice”, Urban Lawyer, Summer, 2005:

 

Abstract: This article explores the phenomenon of privatization, or the shift from government provision of services to provision by the private sector, in the context of privatized neighborhoods. The proliferation of gated and walled communities, together with the significant rise of homeowners associations, contribute to patterns of homogeneity, conformity and exclusion that can yield dangerous consequences. Cultures of litigiousness, fear of the “other,” civic alienation and resident dissatisfaction are among the by-products of these common interest communities’ zealous pursuit of “the nice” place to live.

 

Download at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=871289.

 

Julian Emerson, Housing complex owners vote to ban smoking, Leader Telegram (Eau Claire, Wisconsin, July 19, 2009)

 

 

 

It’s not just indoor public places in Eau Claire where lighting up is prohibited. Now residents of a south side, owner-occupied housing complex will have to snuff out smoking in their homes, the most recent sign of public anti-smoking sentiment.

 

Members of the Fairfax Parkside Homeowners Association on Wednesday voted to outlaw smoking inside residences that are part of the 34-unit development. The ban also prohibits smoking in shared spaces, such as porches and garages, but does allow it in yards and on patios.

 

Of the 19 association members who voted on the issue, 15 favored the anti-smoking regulation proposed by association President Dave Hanvelt, while four argued that residents should be allowed to smoke in their homes.

 

“This doesn’t restrict a smoker from living here,” Hanvelt said of the smoking prohibition. “It just means that there are restrictions on where they can smoke.”

 

Fairfax Parkside is believed to be the first Eau Claire development in which homeowners aren’t allowed to light up indoors.

 

”I’m not aware of any other instances where that is the case,” said Julie Marlette, coordinator of the Tobacco Free Partnership of Eau Claire County.

 

The adoption of the indoor anti-smoking rule likely won’t impact many Fairfax Parkside homeowners, as Hanvelt said he doesn’t know of any smokers in the development. But it does restrict future homeowners there from smoking, and visitors also won’t be allowed to smoke inside.

 

“You don’t want to have to worry about your non-smoking neighbor moving out and a smoker moving in,” he said.

 

Hanvelt proposed the regulation earlier this year because homeowners in the development own twin homes, or each side of a duplex-style home. Because of their close proximity, smoke from one unit could flow into the one next door.

 

“If we all lived in separate units, this wouldn’t have been necessary,” Hanvelt said, noting homeowners association members made sure to allow outdoor smoking so as to not be too restrictive.

 

The Fairfax Parkside regulation marks an extension of non-smoking rules from public places to private residences. Last year the Eau Claire City Council approved a controversial ban on smoking in indoor public places, including taverns.

 

The issue prompted heated response from people on both sides of the issue, and opponents were concerned that the ban could open the door to prohibitions on smoking in people’s homes.

 

Word of the smoking restriction enacted at Fairfax Parkside has some people fuming.

 

“We worried that this might happen, and now it appears that it has,” said Sally Jo Birtzer, a nonsmoker who is president of the Eau Claire City-County Tavern League and general manager of Wagner’s Lanes. “As long as tobacco is a legal product, people should be allowed to smoke it in their own homes.”

 

While preventing smoking in privately owned homes is unusual, prohibiting the practice in rental residences isn’t unheard of in Eau Claire and elsewhere. Some landlords don’t allow renters to smoke indoors in an effort to keep those living quarters cleaner and to reduce the chances of a house fire.

 

Stomping out smoking in multifamily rental units is a growing trend in other parts of the U.S., Marlette said.

 

“I think people are recognizing the exposure that is occurring to secondhand smoke in multiunit housing,” she said. “It is definitely a bona fide health issue, and I think we’re going to see more requests for those units to go smoke free.”

 

Dave FitzGerald, one of the Fairfax Parkside developers who also lives there, initially questioned whether the non-smoking measure would hinder future sales in an already tough housing market. But FitzGerald, a nonsmoker, said the anti-smoking rule could attract buyers too, especially given that nearly four of every five people don’t smoke.

 

“Could we lose a sale to somebody who is a smoker? Certainly,” FitzGerald said. “But I think there is a better chance of having somebody be willing to live here because there isn’t any smoking.”

 

Hanvelt knows firsthand the frustrations of living next to a smoker in a shared-space residence. He previously spent thousands of dollars at a former residence retrofitting his unit to prevent cigarette smoke from a next-door neighbor from making its way to his home, but the effort proved unsuccessful, he said.

 

Now he looks forward to living in a smoke-free environment.

 

“We adopted this for our own safety and health,” Hanvelt said. “This is a very nice place to live, and we want to keep it that way.”

 

 

From Eduardo M. Peñalver, Property as Entrance , 91 Va. L. Rev. 1889, 1967 (2005).

 

 

B. Common-Interest Communities

 

 

A related question, one that has been frequently debated among property scholars, is the degree to which private groups should be allowed to use the property system to govern themselves according to their own values and priorities.  Several scholars have argued that courts should determine the level of deference to afford the community’s own private ordering by asking how voluntarily the members acted in subjecting themselves to a particular set of community rules or how easy it is for them to exit from the community’s jurisdiction.  This view is fully consistent with the notion of property as exit.

 

In another context, however, Abner Greene has proposed a different axis for determining the degree to which society should defer to a group’s private ordering. He argues that communities that have physically separated themselves from the broader society should be entitled to greater discretion in regulating their internal affairs.  The greater the degree of separation achieved by a community, Greene argues, the more entitled it is to structure its own affairs.  Property as entrance supports Greene’s focus on the degree to which the community has chosen to physically separate itself from mainstream society as a particularly salient factor in determining its entitlement to live according to its own rules.

 

In an article on the law of common-interest communities, Clayton Gillette expresses puzzlement that progressive scholars like Greene appear to be more sympathetic to claims of autonomy made by radical religious separatists than they are to similar claims made by mainstream residential associations and other common-interest communities:  

 

[B]oth liberals and communitarians seem to be tolerant of highly distinct subcultures. For the liberal who values individual choice, as for the communitarian who purports not to select among visions of the good, it seems odd to afford substantial protection to communities furthest from the majority culture while affording little protection to those only marginally different from the majority. There seems something anomalous about arguing for protection of groups such as orthodox Jews or the Amish when their cultures conflict with majoritarian norms while opposing similar license for those who seek residence in artificially pastoral settings free from technologies that they deem unsightly or who live in such fear of crime that they literally wall themselves off from the outside world.

 

Gillette goes on to suggest that the deference to separatist groups might stem from a concern with discrimination against insular communities.

 

Viewing property as entrance helps to solve Gillette’s puzzle without resort to explanations based on concerns about discrimination. Separatist groups should be given more power to structure their own affairs because, as a result of their isolation from broader societal norms, they are far better positioned than individuals or most mainstream common-interest communities to take advantage of property’s autonomy-enhancing functions.  Moreover, separatist intentional communities provide a useful service in substantially broadening the range of lifestyles available to members of the mainstream. Finally, separatist groups have far more to lose than the individual from the intrusion of outside values.

 

A group that has gone to the trouble to separate itself from society to live according to its own system of beliefs has an exceptionally strong commitment to that worldview.  As Laurence Veysey puts it, “[t]he hallmark of ‘strong’ belief is the attempt to put one’s ideas into daily practice.”  Accordingly, in the typical case, applying outside rules to such a group will harm that group substantially more than will applying those rules to an individual who merely expresses a strong desire to be governed by his own set of beliefs without having taken the trouble to join (or found) a community that lives according to those beliefs.

 

In contrast to separatist intentional communities, which are united by an all-encompassing set of commitments, the typical homeowners’ association is an agglomeration of individual property owners who have come together (or, more commonly, whom a developer has brought together) for the principal purpose of protecting the property values of each of the individual community members.  Their overriding concern with the preservation of property’s market values leads one common-interest community to look and act very much like another. Moreover, common-interest-community rules typically avoid taking a position on contentious political or social questions not directly related to the preservation of property values.  Most common-interest communities are therefore not mechanisms for escaping from mainstream culture; they are mainstream culture. Indeed, in many parts of the country, virtually all new housing is constructed in the common-interest-community form.

 

Most common-interest communities make no effort to separate their residents in any meaningful sense from the values of the broader society.  That is, residents of common-interest communities typically earn their living outside of their residential community, watch television, go to movies, and otherwise immerse themselves in mainstream culture. In contrast, the residents of separatist intentional communities typically make every effort to separate themselves from the mainstream. They rarely work outside of their communities, and they often shun the instruments of mass culture. Quebec’s Hasidic Jewish community, for example, forbids its members to listen to the radio, watch television, listen to records or cassettes, go to the cinema, or read unapproved magazines, newspapers, or books.  And ten percent of the men work in jobs outside of the community.  The Amish make similar efforts to protect themselves from exposure to outside influence. As Kraybill puts it:

 

    Separation from the world is a cardinal tenet of Amish faith. . . . The struggle to be a separate people is translated into many areas of life–dress, transportation, marriage to outsiders, the use of mass media, membership in public organizations, and public office holding, to name a few.

 

Because common-interest communities and their residents are typically so firmly embedded in the mainstream, granting them autonomy generates fewer of the liberty-securing benefits that accrue from allowing separatist dissenting groups to govern themselves.  Residents’ frequent interaction with non-residents means that they will be subject to the conformity-inducing social norms operative in the larger community. In addition, common-interest communities do less than radical separatists to enhance normative diversity.

 

Finally, imposing mainstream norms on most common-interest communities would be unlikely to harm the community to the degree that would result from applying those norms to true opt-out communities. Because common-interest-community residents are for the most part committed to the same sorts of values that operate outside of the particular residential enclave, reviewing common-interest-community rules for “reasonableness” in light of those values is unlikely to trample on deeply held beliefs of the common-interest-community residents.  The intrusiveness of such reasonableness review of common-interest-community rulemaking would be further mitigated and the goals of fostering normative diversity enhanced if, as is sometimes the case, courts understand “reasonableness” in light of the particular community’s own stated goals.

 

 

(footnotes omitted)

 

 

PROBLEMS

 

 

 

    1. Will prohibitions in a declaration that are unreasonable always be struck down?

       

 

    1. What is the rationale for your answer?

       

 

    1. How about rules promulgated by a HOA pursuant to a declaration?

       

 

    1. What’s the rationale for that?

       

 

 

 

 

 

7.3. Public Accommodations

 

7.3.1. Common Law

 

Uston v. Resorts Intern. Hotel, Inc.,

89 N.J. 163 (1982)

 

 

 

Pashman, J.

 

 

 

Since January 30, 1979, appellant Resorts International Hotel, Inc. (Resorts) has excluded respondent, Kenneth Uston, from the blackjack tables in its casino because Uston’s strategy increases his chances of winning money. Uston concedes that his strategy of card counting can tilt the odds in his favor under the current blackjack rules promulgated by the Casino Control Commission (Commission). However, Uston contends that Resorts has no common law or statutory right to exclude him because of his strategy for playing blackjack.

 

We hold that the Casino Control Act, N.J.S.A. 5:12-1 to -152 gives the Commission exclusive authority to set the rules of licensed casino games, which includes the methods for playing those games. The Casino Control Act therefore precludes Resorts from excluding Uston for card counting. Because the Commission has not exercised its exclusive authority to determine whether card counters should be excluded, we do not decide whether such an exclusion would be lawful.

 

 

 

I

 

 

 

Kenneth Uston is a renowned teacher and practitioner of a complex strategy for playing blackjack known as card counting.1 Card counters keep track of the playing cards as they are dealt and adjust their betting patterns when the odds are in their favor. When used over a period of time, this method allegedly ensures a profitable encounter with the casino.

 

Uston first played blackjack at Resorts’ casino in November 1978. Resorts took no steps to bar Uston at that time, apparently because the Commission’s blackjack rules then in operation minimized the advantages of card counting.

 

On January 5, 1979, however, a new Commission rule took effect that dramatically improved the card counter’s odds. N.J.A.C. 19:47-2.5. The new rule, which remains in effect, restricted the reshuffling of the deck in ways that benefitted card counters. Resorts concedes that the Commission could promulgate blackjack rules that virtually eliminate the advantage of card counting. However, such rules would slow the game, diminishing the casino’s “take” and consequently its profits from blackjack gaming.

 

By letter dated January 30, 1979, attorneys for Resorts wrote to Commission Chairman Lordi, asking the Commission’s position on the legality of summarily removing card counters from its blackjack tables. That same day, Commissioner Lordi responded in writing that no statute or regulation barred Resorts from excluding professional card counters from its casino. Before the day had ended, Resorts terminated Uston’s career at its blackjack tables, on the basis that in its opinion he was a professional card counter. Resorts subsequently formulated standards for identification of card counters and adopted a general policy to exclude such players.2

 

The Commission upheld Resorts’ decision to exclude Uston. Relying on Garifine v. Monmouth Park Jockey Club, 29 N.J. 47 (1959), the Commission held that Resorts enjoys a common law right to exclude anyone it chooses, as long as the exclusion does not violate state and federal civil rights laws. The Appellate Division reversed, 179 N.J. Super. 223 (1981). Although we interpret the Casino Control Act, N.J.S.A. 5:12-1 to -152 somewhat differently than did the Appellate Division, we affirm that court’s holding that the Casino Control Act precludes Resorts from excluding Uston. The Commission alone has the authority to exclude patrons based upon their strategies for playing licensed casino games. Any common law right Resorts may have had to exclude Uston for these reasons is abrogated by the act. We therefore need not decide the precise extent of Resorts’ common law right to exclude patrons for reasons not covered by the act. Nonetheless, we feel constrained to refute any implication arising from the Commission’s opinion that absent supervening statutes, the owners of places open to the public enjoy an absolute right to exclude patrons without good cause. We hold that the common law right to exclude is substantially limited by a competing common law right of reasonable access to public places.

 

 

 

II

 

 

 

This Court has recognized that “[t]he statutory and administrative controls over casino operations established by the [Casino Control] Act are extraordinarily pervasive and intensive.” Knight v. Margate, 86 N.J. 374, 380-81 (1981). The almost 200 separate statutory provisions “cover virtually every facet of casino gambling and its potential impact upon the public.” Id. at 381. See Bally Mfg. Corp. v. N. J. Casino Control Comm’n, 85 N.J. 325 (1981) (upholding Commission regulation barring a licensed casino from acquiring more than 50% of its slot machines from any one manufacturer). These provisions include a preemption clause, stating that the act prevails over “any other provision of law” in conflict or inconsistent with its provisions. N.J.S.A. 5:12-133(b). Moreover, the act declares as public policy of this State “that the institution of licensed casino establishments in New Jersey be strictly regulated and controlled.” N.J.S.A. 5:12-1(13).

 

At the heart of the Casino Control Act are its provisions for the regulation of licensed casino games. N.J.S.A. 5:12-100 provides:

 

 

… e. All gaming shall be conducted according to rules promulgated by the commission. All wagers and pay-offs of winning wagers at table games shall be made according to rules promulgated by the commission, which shall establish such minimum wagers and other limitations as may be necessary to assure the vitality of casino operations and fair odds to and maximum participation by casino patrons; ….

 

 

This provision on games and gaming equipment reinforces the general statutory provisions codified at N.J.S.A. 5:12-70. Those provisions provide in part:

 

 

The Commission shall, without limitation on the powers conferred in the preceding section, include within its regulations the following specific provisions in accordance with the provisions of the act;

 

… .

 

f. Defining and limiting the areas of operation, the rules of authorized games, odds, and devices permitted, and the method of operation of such games and devices; ….

 

 

 

 

Pursuant to these statutes, the Commission has promulgated exhaustive rules on the playing of blackjack. N.J.A.C. 19:47-2.1 to -2.13. These rules cover every conceivable aspect of the game, from determining how the cards are to be shuffled and cut, N.J.A.C. 19:47-2.5, to providing that certain cards shall not be dealt “until the dealer has first announced ‘Dealer’s Card’ which shall be stated by the dealer in a tone of voice calculated to be heard by each person at the table.” N.J.A.C. 19:47-2.6(g). It is no exaggeration to state that the Commission’s regulation of blackjack is more extensive than the entire administrative regulation of many industries.

 

These exhaustive statutes and regulations make clear that the Commission’s control over the rules and conduct of licensed casino games is intended to be comprehensive. The ability of casino operators to determine how the games will be played would undermine this control and subvert the important policy of ensuring the “credibility and integrity of the regulatory process and of casino operations.” N.J.S.A. 5:12-1(b). The Commission has promulgated the blackjack rules that give Uston a comparative advantage, and it has sole authority to change those rules. There is no indication that Uston has violated any Commission rule on the playing of blackjack. N.J.A.C. 19:47-2.1 to -2.13. Put simply, Uston’s gaming is “conducted according to rules promulgated by the Commission.” N.J.S.A. 5:12-100(e). Resorts has no right to exclude Uston on grounds that he successfully plays the game under existing rules.3

 

The Attorney General interpreted s 71 to be a tightly circumscribed intrusion on common law rights. We need not determine whether s 71, standing alone, would give the Commission the authority to exclude card counters. Cf. Uston v. Hilton Hotels Corp., 448 F.Supp. 116 (D.Nev.1978) (interpreting Nevada statute virtually identical to s 71 as having no bearing on whether card-counters can be excluded from casinos).

 

 

 

III

 

 

 

Resorts claimed that it could exclude Uston because it had a common law right to exclude anyone at all for any reason. While we hold that the Casino Control Act precludes Resorts from excluding Uston for the reasons stated, it is important for us to address the asserted common law right for two reasons. First, Resorts’ contentions and the Commission’s position concerning the common law right are incorrect. Second, the act has not completely divested Resorts of its common law right to exclude.

 

The right of an amusement place owner to exclude unwanted patrons and the patron’s competing right of reasonable access both have deep roots in the common law. See Arterburn, The Origin and First Test of Public Callings, 75 U. Pa. L. Rev. 411 (1927); Wyman, The Law of Public Callings as a Solution of the Trust Problem, 17 Harv. L. Rev. 156 (1904). In this century, however, courts have disregarded the right of reasonable access in the common law of some jurisdictions at the time the Civil War Amendments and Civil Rights Act of 1866 were passed.

 

As Justice Goldberg noted in his concurrence in Bell v. Maryland, 378 U.S. 226 (1964):

 

 

Underlying the congressional discussions and at the heart of the Fourteenth Amendment’s guarantee of equal protection, was the assumption that the State by statute or by “the good old common law” was obligated to guarantee all citizens access to places of public accommodation.

 

 

378 U.S. at 296, Goldberg, J., joined by Warren, C. J. and Douglas, J., concurring. See, e.g., Ferguson v. Gies, 82 Mich. 358 (1890) (after passage of the Fourteenth Amendment, both the civil rights statutes and the common law provided grounds for a non-white plaintiff to recover damages from a restaurant owner’s refusal to serve him, because the common law as it existed before passage of the civil rights laws “gave to the white man a remedy against any unjust discrimination to the citizen in all public places”); Donnell v. State, 48 Miss. 661 (1873) (state’s common law includes a right of reasonable access to all public places).

 

The current majority American rule has for many years disregarded the right of reasonable access,4 granting to proprietors of amusement places an absolute right arbitrarily to eject or exclude any person consistent with state and federal civil rights laws. See Annot., Propriety of exclusion of persons from horseracing tracks for reasons other than color or race, 90 A.L.R.3d 1361 (1979); Turner & Kennedy, Exclusion, Ejection and Segregation of Theater Patrons, 32 Iowa L. Rev. 625 (1947). See also Garifine v. Monmouth Park Jockey Club, 29 N.J. at 50, 148 A.2d 1.

 

At one time, an absolute right of exclusion prevailed in this state, though more for reasons of deference to the noted English precedent of Wood v. Leadbitter, 153 Eng.Rep. 351, (Ex.1845), than for reasons of policy. In Shubert v. Nixon Amusement Co., 83 N.J.L. 101 (Sup. Ct. 1912), the former Supreme Court dismissed a suit for damages resulting from plaintiff’s ejection from defendants’ theater. Noting that plaintiff made no allegation of exclusion on the basis of race, color or previous condition of servitude, the Court concluded:

 

 

In view of the substantially uniform approval of, and reliance on, the decision in Wood v. Leadbitter in our state adjudications, it must fairly be considered to be adopted as part of our jurisprudence, and whatever views may be entertained as to the natural justice or injustice of ejecting a theater patron without reason after he has paid for his ticket and taken his seat, we feel constrained to follow that decision as the settled law.

 

 

83 N.J.L. at 106, 83 A. 369.

 

It hardly bears mention that our common law has evolved in the intervening 70 years. In fact, Leadbitter itself was disapproved three years after the Shubert decision by Hurst v. Picture Theatres Limited, (1915) 1 K.B. 1 (1914). Of far greater importance, the decisions of this Court have recognized that “the more private property is devoted to public use, the more it must accommodate the rights which inhere in individual members of the general public who use that property.” State v. Schmid, 84 N.J. 535, 562 (1980).

 

State v. Schmid involved the constitutional right to distribute literature on a private university campus. The Court’s approach in that case balanced individual rights against property rights. It is therefore analogous to a description of the common law right of exclusion. Balancing the university’s interest in controlling its property against plaintiff’s interest in access to that property to express his views, the Court clearly refused to protect unreasonable exclusions. Justice Handler noted that

 

 

Regulations … devoid of reasonable standards designed to protect both the legitimate interests of the University as an institution of higher education and the individual exercise of expressional freedom cannot constitutionally be invoked to prohibit the otherwise noninjurious and reasonable exercise of [First Amendment] freedoms.

 

 

Id. at 567, 423 A.2d 615.

 

In State v. Shack, 58 N.J. 297 (1971), the Court held that although an employer of migrant farm workers “may reasonably require” those visiting his employees to identify themselves, “the employer may not deny the worker his privacy or interfere with his opportunity to live with dignity and to enjoy associations customary among our citizens.” Id. at 308. The Court reversed the trespass convictions of an attorney and a social services worker who had entered the property to assist farmworkers there.

 

Schmid recognizes implicitly that when property owners open their premises to the general public in the pursuit of their own property interests, they have no right to exclude people unreasonably. On the contrary, they have a duty not to act in an arbitrary or discriminatory manner toward persons who come on their premises. That duty applies not only to common carriers, Messenger v. Pennsylvania Railroad Co., 37 N.J.L. 531 (E. & A. 1874), innkeepers, see Garifine, supra, owners of gasoline service stations, Streeter v. Brogan, 113 N.J. Super. 486 (Ch. Div. 1971), or to private hospitals, Doe v. Bridgeton Hospital Ass’n, Inc., 71 N.J. 478 (1976), but to all property owners who open their premises to the public. Property owners have no legitimate interest in unreasonably excluding particular members of the public when they open their premises for public use.

 

No party in this appeal questions the right of property owners to exclude from their premises those whose actions “disrupt the regular and essential operations of the [premises],” State v. Schmid, 84 N.J. at 566 (quoting Princeton University Regulations on solicitation), or threaten the security of the premises and its occupants, see State v. Shack, 58 N.J. at 308. In some circumstances, proprietors have a duty to remove disorderly or otherwise dangerous persons from the premises. See Holly v. Meyers Hotel and Tavern, Inc., 9 N.J. 493, 495. These common law principles enable the casino to bar from its entire facility, for instance, the disorderly, the intoxicated, and the repetitive petty offender.

 

Whether a decision to exclude is reasonable must be determined from the facts of each case.5 Respondent Uston does not threaten the security of any casino occupant. Nor has he disrupted the functioning of any casino operations. Absent a valid contrary rule by the Commission, Uston possesses the usual right of reasonable access to Resorts International’s blackjack tables.

 

 

 

IV

 

 

 

Although the Commission alone has authority to exclude persons based upon their methods of playing licensed casino games, that authority has constitutional and statutory limits. We expressly decline to decide whether the Casino Control Act empowers the Commission to exclude card counters.

 

If the Commission decides to consider promulgating a rule banning card counters, it should review the statutory mandates regarding both the public policy of this State and the rules of licensed games. The Casino Control Act commands the Commission to regulate gambling with such “limitations as may be necessary to assure the vitality of casino operations and fair odds to and maximum participation by casino patrons,” N.J.S.A. 5:12-100(e) (emphasis added). The Court recognizes that the goals of casino vitality, fair odds to all players and maximum player participation may be in conflict. It is the Commission which must strike the appropriate balance.

 

The Commission should also consider that the Legislature has declared as public policy of this state that “[c]onfidence in casino gaming operations is eroded to the extent the State of New Jersey does not provide a regulatory framework for casino gaming that permits and promotes stability and continuity in casino gaming operations.” N.J.S.A. 5:12-1(14). Moreover, “[a]n integral and essential element of the regulation and control of such casino facilities by the State rests in the public confidence and trust in the credibility and integrity of the regulatory process and of casino operations.” N.J.S.A. 5:12-1(6). The exclusion of persons who can play the licensed games to their advantage may diminish public confidence in the fairness of casino gaming. To the extent persons not counting cards would be mistakenly excluded, public confidence might be further diminished. However, the right of the casinos to have the rules drawn so as to allow some reasonable profit must also be recognized in any realistic assessment. The Commission should consider the potentially broad ramifications of excluding card counters before it seeks to promulgate such a rule. Fairness and the integrity of casino gaming are the touchstones.

 

 

 

V

 

 

 

In sum, absent a valid Commission regulation excluding card counters, respondent Uston will be free to employ his card-counting strategy at Resorts’ blackjack tables. There is currently no Commission rule banning Uston, and Resorts has no authority to exclude him for card counting. However, it is not clear whether the Commission would have adopted regulations involving card counters had it known that Resorts could not exclude Uston. The Court therefore continues the temporary order banning Uston from Resorts’ blackjack tables for 90 days from the date of this opinion. After that time, respondent is free to play blackjack at Resorts’ casino absent a valid Commission rule excluding him.

 

For affirmance -Justices Pashman, Clifford, Schreiber, Handler, and O’Hern-5.

 

For reversal -None.

 


    1. Uston has described his strategy and his alleged success at Atlantic City blackjack tables on broadcast media and in books. See Uston, Two Books on Blackjack.

 

    1. Since then an industry-wide policy has developed to ban card counters. Each casino maintains its own list of persons to be barred as card counters.

 

    1. The Appellate Division relied on N.J.S.A. 5:12-71 (s 71) to establish the Commission’s right to exclude Uston. That provision directs the Commission to compile a list of persons to be excluded from gaming casinos whose presence in the casino would be inimical to the interests of casino gambling in New Jersey. N.J.S.A. 5:12-71(a)(3). The section applies to persons whose backgrounds or occupations indicate either criminal activity or actions hostile to the integrity of licensed casino gambling. We do not rely on this portion of the statute.

 

    1. The denial of freedom of reasonable access in some States following passage of the Fourteenth Amendment, and the creation of a common law freedom to arbitrarily exclude following invalidation of segregation statutes, suggest that the current majority rule may have had less than dignified origins. See Bell v. Maryland, supra.

 

    1. We need not decide whether the common law allows exclusion of those merely suspected of criminal activity, see Garifine, supra, 29 N.J. at 57, because the Casino Control Act clearly vests such decisions in the Commission alone. N.J.S.A. 5:12-71.

 

 

 

Brooks v. Chicago Downs Assoc.,

791 F.2d 512 (7th Cir. 1986)

 

 

 

Francis X. Grossi, Jr., Eric N. Landau, James E. Hanlon, Jr., Katten, Muchin, Zavis, Pearl & Galler, Chicago, Ill., for plaintiffs-appellants.

 

George S. Lalich, Nash & Lalich, Chicago, Ill., for defendant-appellee.

 

Before Cudahy, Flaum, and Easterbrook, Circuit Judges.

 

 

 

Flaum, Circuit Judge.

 

 

 

This is a case of first impression on whether under Illinois law the operator of a horse race track has the absolute right to exclude a patron from the track premises for any reason, or no reason, except race, color, creed, national origin, or sex. We find that Illinois follows the common law rule and would allow the exclusion. The court below is thus affirmed.

 

 

 

 

I

 

 

 

 

Plaintiffs are citizens of Pennsylvania who have formed a Pennsylvania partnership whose sole purpose is to pool the assets of the partners in order to place bets at horse racing tracks throughout the country. The plaintiffs are self-proclaimed expert handicappers, even though on the approximately 140 days they have bet at various race tracks they have ended up with net losses on 110 of those days. This case is about a bet they were not allowed to make.

 

The defendant is a private Illinois corporation licensed by the State of Illinois to conduct harness racing at Sportsman’s Park race track in Cicero, Illinois. At various times during the racing season, Sportsman’s Park conducts a parimutual pool known as “Super Bet.” In order to win the Super Bet pool, one must select the first two finishers of the fifth and sixth races and the first three finishers of the seventh race. The Super Bet pool is able to increase quickly and substantially because if the pool is not won on any given day, the total amount wagered is rolled over and added to the Super Bet purse for the next racing date. For example, in April of 1985 the plaintiffs, using their method for handicapping horses, placed bets on the Super Bet totalling $60,000. They picked the right horses and took home approximately $600,000.

 

In late July, 1985 the president of Chicago Downs ordered two of the plaintiffs (Jeffrey Yass and Kenneth Brodie) barred from Sportsman’s Park just as they were seeking to place a $250,000 wager in the Super Bet. After the plaintiffs had been barred from Sportsman’s Park, the Park’s counsel informed them that they would be denied entry to all future racing dates at the Park. The plaintiffs then filed suit seeking injunctive relief that would prohibit the defendant from barring them from entering the race track premises. Sportsman’s Park filed a motion to dismiss the complaint on the ground that under Illinois law the operator of a proprietary race track has the absolute right to exclude a patron from the track premises for any reason except race, creed, color, national origin, or sex. The trial court agreed with the defendants and granted their motion to dismiss, from which the plaintiffs now appeal. We affirm.

 

 

 

 

II

 

 

 

 

… .

 

The parties do not contest the Illinois Supreme Court’s holding that a race track operator has the right to exclude patrons for good cause. Phillips v. Graham, 86 Ill.2d 274, 56 Ill.Dec. 355, 427 N.E.2d 550 (1981). But in this case, the race track argues that it should be able to exclude a patron absent any cause at all, as long as it does not do so on the basis of race, color, creed, national origin, or sex. Under the defendant’s theory, because the race track is a privately owned place of amusement it may exclude someone simply for wearing a green hat or a paisley tie. It need give no reason for excluding the patron, under its version of the common law, because it is not a state-granted monopoly, but a state-regulated licensee operating on private property.

 

The most recent Illinois Supreme Court case to touch on this issue was Phillips v. Graham, 86 Ill.2d 274, 56 Ill.Dec. 355, 427 N.E.2d 550 (1981). In Phillips several harness racing drivers, owners, and trainers were excluded by formal Order of the State Racing Board from all race tracks in the state because they had been indicted for bribery. The Illinois Supreme Court … held that the authority given organization licensees (such as race tracks) to exclude occupation licensees (such as jockeys) from their private property was not an unconstitutional delegation of legislative power. Paragraph 9(e) of the Illinois Horse Racing Act of 1975 states:

 

 

The power to eject or exclude occupation licensees [trainers, jockeys, owners, etc.] may be exercised for just cause by the organization licensee [race track] or Board subject to subsequent hearing by the Board, as to the propriety of said exclusion.

 

 

Ill.Rev.Stat., ch. 8, par. 37-9(e) (1985). The addition of this section to the Act followed closely on the heels of Cox v. National Jockey Club, 25 Ill.App.3d 160, 323 N.E.2d 104 (1974) and apparently codifies its holding.

 

… .

 

The Cox court differentiated between the right of a track to exclude a licensee and its right to bar a patron. The track had argued that its common law right to exclude a patron without reason applied equally to a licensee. Although acknowledging precedent which held that the track could exclude a patron without reason or justification, the court refused to extend that authority to cover a licensee … .

 

The language of Phillips and Cox lead us to conclude that Illinois follows the common law rule regarding the exclusion of patrons, as opposed to the exclusion of licensees which is governed by the “just cause” rule codified in 9(e). Of the cases cited by the Illinois courts as demonstrating the common law rule, Madden v. Queens County Jockey Club, 296 N.Y. 249, 72 N.E.2d 697 (Ct.App.), cert. denied, 332 U.S. 761, 68 S.Ct. 63, 92 L.Ed. 346 (1947), is the most explicit and most cited. The plaintiff, “Coley” Madden, who claimed to be a professional “patron of the races,” was barred from the defendant’s Aqueduct Race Track under the mistaken belief that he was “Owney” Madden, reputed to be the fabled Frank Costello’s bookmaker. Coley Madden brought suit for declaratory judgment and contended that as a citizen and taxpayer he had the right to enter the track and patronize the races. The defendant moved to dismiss on the ground that it had an unlimited right of exclusion. The trial court granted plaintiff’s motion and entered an order enjoining the defendant from barring Coley Madden from its race track. The appellate division reversed, 269 App.Div. 644, 58 N.Y.S.2d 272, and the New York Court of Appeals affirmed the appellate division’s reversal of the trial court. The Court of Appeals framed the question: “Whether the operator of a race track can, without reason or sufficient excuse, exclude a person from attending its races.” 72 N.E.2d at 698. Its answer: “In our opinion he can; he has the power to admit as spectators only those whom he may select, and to exclude others solely of his own [volition,] as long as the exclusion is not founded on race, creed, color or national origin.” 72 N.E.2d at 698.

 

The court went on to explain the common law:

 

 

At common law a person engaged in a public calling, such as innkeeper or common carrier, was held to be under a duty to the general public and was obliged to serve, without discrimination, all who sought service. [Citations omitted.] On the other hand, proprietors of private enterprises, such as places of amusement and resort, were under no such obligation, enjoying an absolute power to serve whom they pleased. [Citations omitted.] A race track, of course, falls within that classification.

 

 

72 N.E.2d at 698 (emphasis added).

 

… .

 

In holding that Illinois follows the traditional common law rule we are not unmindful that several other states have questioned that rule as a matter both of law and of policy. For example, many of the states that follow the common law rule have used language broader than the facts in the case before them required. While these cases state that a proprietor has the absolute right to exclude, the facts of the case show that just cause existed to exclude the patron. See, e.g., Silbert v. Ramsey, 301 Md. 96, 482 A.2d 147 (1984) (patron excluded on the basis of his prior conviction for violation of state lottery laws); James v. Churchill Downs, Inc., 620 S.W.2d 323 (Ky.App.1981) (excluded patron was a convicted bookmaker); Tropical Park, Inc. v. Jack, 374 So.2d 639 (Fla.App.1979) (patron alleged to have “known underworld connections” was rightfully excluded); Burrillville Racing Association v. Garabedian, 113 R.I. 134, 318 A.2d 469 (1974) (excluded patron had prior conviction for income tax evasion in connection with a wager messenger operation); People v. Licata, 28 N.Y.2d 113, 268 N.E.2d 787 (1971) (defendant had prior convictions for bookmaking); Flores v. Los Angeles Turf Club, Inc., 55 Cal.2d 736, 13 Cal.Rptr. 201, 361 P.2d 921 (1961) (plaintiff was a convicted bookmaker). But that fact only demonstrates that proprietors of amusement facilities, whose very survival depends on bringing the public into their place of amusement, are reasonable people who usually do not exclude their customers unless they have a reason to do so. What the proprietor of a race track does not want to have to do is prove or explain that his reason for exclusion is a just reason. He doesn’t want to be liable to Coley Madden solely because he mistakenly believed he was a mobster. The proprietor wants to be able to keep someone off his private property even if they only look like a mobster. As long as the proprietor is not excluding the mobster look-a-like because of his national origin (or because of race, color, creed, or sex), then the common law, and the law of Illinois, allows him to do just that.

 

We also choose not to follow the arguable – but not clear – abandonment of the common law rule in New Jersey in the case of Uston v. Resorts International Hotel, Inc., 89 N.J. 163, 445 A.2d 370 (1982). In 1959 the New Jersey Supreme Court decided Garifine v. Monmouth Park Jockey Club, 29 N.J. 47, 148 A.2d 1 (Sup.Ct.1959), which was an appeal from the trial court’s refusal to grant the plaintiff injunctive relief from his exclusion from Monmouth Park race track. The defendant race track, relying on Madden, moved to dismiss the complaint on the ground that it had “an absolute right” to exclude the plaintiff. On appeal, the plaintiff contended that the operator of a race track should not have the common law right to exclude a patron without reasonable cause and that under the New Jersey Civil Rights Act the operator did not have such authority. In a scholarly opinion the court traced the genesis of the right of race tracks to exclude patrons without justifying the exclusion:

 

 

There was a time in English history when the common law recognized in many callings the duty to serve the public without discrimination. [Citations omitted.] With the passing of time and the changing of conditions, the common law confined this duty to exceptional callings where the needs of the public urgently called for its continuance. Innkeepers and common carriers may be said to be the most notable illustrations of business operators who, both under early principles and under the common law today, are obliged to serve the public without discrimination. [Citations omitted.] On the other hand, operators of most businesses, including places of amusement such as race tracks, have never been placed under any such common-law obligation, for no comparable considerations of public policy have ever so dictated. See Madden v. Queens County Jockey Club, 296 N.Y. 249, 72 N.E.2d 697, 1 A.L.R.2d 1160 (Ct.App.1947), cert. denied 332 U.S. 761, 68 S.Ct. 63, 92 L.Ed. 346 (1947); Greenfield v. Maryland Jockey Club, 190 Md. 96, 57 A.2d 335 (Ct.App.1948). Cf. Marrone v. Washington Jockey Club, 227 U.S. 633, 33 S.Ct. 401, 57 L.Ed. 679 (1913)….

 

 

 

No holdings contrary to the foregoing have been cited by the plaintiff; and although he has urged that the defendant’s common-law right of exclusion from its race track should be limited because as a licensee “it has secured the advantage of a State monopoly” we find no force in his contention. See Madden v. Queens County Jockey Club, supra; Greenfeld v. Maryland Jockey Club, supra.… The burden of the plaintiff’s present attack is on the common-law doctrine which he states should be altered to afford to him a right of admission to the race track in the absence of affirmative legal proof by the defendant that there is good cause for his exclusion. We are satisfied that, without regard to views which may be entertained in other types of cases, there has been no showing made here for such alteration….

 

 

148 A.2d at 6-7. However, in 1982 the New Jersey Supreme Court decided Uston in which the plaintiff was a practitioner of a strategy of playing blackjack known as “card counting.” The defendant operated a gambling casino licensed pursuant to the New Jersey Casino Control Act. The defendant excluded Uston from the blackjack tables in its casino because of Uston’s strategy of “card counting.” The New Jersey Supreme Court held that the Casino Control Act gave the Casino Control Commission the exclusive authority to exclude patrons based upon their strategies for playing licensed casino games and that any common law right the defendant may have had to exclude Uston for these reasons was abrogated by the Act and outweighed by Uston’s right of access. Uston, 445 A.2d at 372.

 

In Marzocca v. Ferone, 93 N.J. 509, 461 A.2d 1133 (1983), the owner of a harness race horse was barred from racing that horse at Freehold Raceway in New Jersey. The appellate court determined that Uston overruled Garifine v. Monmouth Park Jockey Club, sub silentio, and remanded the case to the trial court to hear evidence as to whether the race track’s exclusion was reasonable. The case was then appealed to the New Jersey Supreme Court, where the court clarified its decision in Uston and reversed the appellate court, stating:

 

 

Notwithstanding the dicta in Uston, we must part company with the court below on the issue of Freehold’s right to exclude. Without commenting on the status of the law in the amusement owner/patron context, we hold that the racetrack’s common law right to exclude exists in the context of this case, i.e., where the relationship [is] between the track management and persons who wish to perform their vocational activities on the track premises.

 

 

461 A.2d at 1137. Therefore, it is clear that New Jersey has not per se abandoned the common law rule but has adapted it, in a limited fashion, to the particular needs of its casino industry. New Jersey has not gone as far as Illinois did in Cox, and in the Illinois Racing Statute, but they give no reason why the patron is more protected than the licensee. The law of New Jersey does not directly conflict with the law of Illinois that we inferred from Phillips and Cox, but to the extent that it is different, the differences are further evidence that Illinois follows the common law approach.

 

However, the New Jersey decisions do paint the wider policy picture of which our decision today is a part. As a policy matter, it is arguably unfair to allow a place of amusement to exclude for any reason or no reason, and to be free of accountability, except in cases of obvious discrimination. In this case, the general public is not only invited but, through advertising, is encouraged to come to the race track and wager on the races’ outcome. But the common law allows the race track to exclude patrons, no matter if they come from near or far, or in reasonable reliance on representations of accessibility. We may ultimately believe that market forces would preclude any outrageous excesses – such as excluding anyone who has blond hair, or (like the plaintiffs) who is from Pennsylvania, or (even more outrageous) who has $250,000 to spend in one day of betting. But the premise of the consumer protection laws that the New Jersey Supreme Court alluded to in Uston and Marzocca recognizes that the reality of an imperfect market allows numerous consumer depredations. Excluding a patron simply because he is named Adam Smith arguably offends the very precepts of equality and fair dealing expressed in everything from the antitrust statutes to the Illinois Consumer Fraud and Deceptive Business Practice Act. Ill.Rev.Stat. ch. 121­, ¶¶ 262-72.

 

But the market here is not so demonstrably imperfect that there is a monopoly or any allegation of consumer fraud. Consequently, there is no such explicit legislative directive in the context of patrons attending horse races in Illinois – so the common law rule, relic though it may be,1 still controls. Therefore, within the prohibitions of Erie, the language of the Illinois cases, and the lack of language from the Illinois legislature, we hold that the common law rule is the law of Illinois.

 

 

 

 

III

 

 

 

 

For the foregoing reasons the court below is affirmed.

 


    1. As the New Jersey Supreme court noted in Uston, the rise of the American common law right to exclude without cause alarmingly corresponds to the fall of the old segregation laws. However, that is clearly not an issue in this case because the legislature has justly limited the absolute right to exclude to cases not involving exclusion based on race, creed, color, national origin, or sex. Uston, 445 A.2d at 374 n. 4.

 

 

 

 

 

7.3. Public Accommodations

 

7.3.1. Common Law

 

Uston v. Resorts Intern. Hotel, Inc.,

89 N.J. 163 (1982)

 

 

 

Pashman, J.

 

 

 

Since January 30, 1979, appellant Resorts International Hotel, Inc. (Resorts) has excluded respondent, Kenneth Uston, from the blackjack tables in its casino because Uston’s strategy increases his chances of winning money. Uston concedes that his strategy of card counting can tilt the odds in his favor under the current blackjack rules promulgated by the Casino Control Commission (Commission). However, Uston contends that Resorts has no common law or statutory right to exclude him because of his strategy for playing blackjack.

 

We hold that the Casino Control Act, N.J.S.A. 5:12-1 to -152 gives the Commission exclusive authority to set the rules of licensed casino games, which includes the methods for playing those games. The Casino Control Act therefore precludes Resorts from excluding Uston for card counting. Because the Commission has not exercised its exclusive authority to determine whether card counters should be excluded, we do not decide whether such an exclusion would be lawful.

 

 

 

I

 

 

 

Kenneth Uston is a renowned teacher and practitioner of a complex strategy for playing blackjack known as card counting.1 Card counters keep track of the playing cards as they are dealt and adjust their betting patterns when the odds are in their favor. When used over a period of time, this method allegedly ensures a profitable encounter with the casino.

 

Uston first played blackjack at Resorts’ casino in November 1978. Resorts took no steps to bar Uston at that time, apparently because the Commission’s blackjack rules then in operation minimized the advantages of card counting.

 

On January 5, 1979, however, a new Commission rule took effect that dramatically improved the card counter’s odds. N.J.A.C. 19:47-2.5. The new rule, which remains in effect, restricted the reshuffling of the deck in ways that benefitted card counters. Resorts concedes that the Commission could promulgate blackjack rules that virtually eliminate the advantage of card counting. However, such rules would slow the game, diminishing the casino’s “take” and consequently its profits from blackjack gaming.

 

By letter dated January 30, 1979, attorneys for Resorts wrote to Commission Chairman Lordi, asking the Commission’s position on the legality of summarily removing card counters from its blackjack tables. That same day, Commissioner Lordi responded in writing that no statute or regulation barred Resorts from excluding professional card counters from its casino. Before the day had ended, Resorts terminated Uston’s career at its blackjack tables, on the basis that in its opinion he was a professional card counter. Resorts subsequently formulated standards for identification of card counters and adopted a general policy to exclude such players.2

 

The Commission upheld Resorts’ decision to exclude Uston. Relying on Garifine v. Monmouth Park Jockey Club, 29 N.J. 47 (1959), the Commission held that Resorts enjoys a common law right to exclude anyone it chooses, as long as the exclusion does not violate state and federal civil rights laws. The Appellate Division reversed, 179 N.J. Super. 223 (1981). Although we interpret the Casino Control Act, N.J.S.A. 5:12-1 to -152 somewhat differently than did the Appellate Division, we affirm that court’s holding that the Casino Control Act precludes Resorts from excluding Uston. The Commission alone has the authority to exclude patrons based upon their strategies for playing licensed casino games. Any common law right Resorts may have had to exclude Uston for these reasons is abrogated by the act. We therefore need not decide the precise extent of Resorts’ common law right to exclude patrons for reasons not covered by the act. Nonetheless, we feel constrained to refute any implication arising from the Commission’s opinion that absent supervening statutes, the owners of places open to the public enjoy an absolute right to exclude patrons without good cause. We hold that the common law right to exclude is substantially limited by a competing common law right of reasonable access to public places.

 

 

 

II

 

 

 

This Court has recognized that “[t]he statutory and administrative controls over casino operations established by the [Casino Control] Act are extraordinarily pervasive and intensive.” Knight v. Margate, 86 N.J. 374, 380-81 (1981). The almost 200 separate statutory provisions “cover virtually every facet of casino gambling and its potential impact upon the public.” Id. at 381. See Bally Mfg. Corp. v. N. J. Casino Control Comm’n, 85 N.J. 325 (1981) (upholding Commission regulation barring a licensed casino from acquiring more than 50% of its slot machines from any one manufacturer). These provisions include a preemption clause, stating that the act prevails over “any other provision of law” in conflict or inconsistent with its provisions. N.J.S.A. 5:12-133(b). Moreover, the act declares as public policy of this State “that the institution of licensed casino establishments in New Jersey be strictly regulated and controlled.” N.J.S.A. 5:12-1(13).

 

At the heart of the Casino Control Act are its provisions for the regulation of licensed casino games. N.J.S.A. 5:12-100 provides:

 

 

… e. All gaming shall be conducted according to rules promulgated by the commission. All wagers and pay-offs of winning wagers at table games shall be made according to rules promulgated by the commission, which shall establish such minimum wagers and other limitations as may be necessary to assure the vitality of casino operations and fair odds to and maximum participation by casino patrons; ….

 

 

This provision on games and gaming equipment reinforces the general statutory provisions codified at N.J.S.A. 5:12-70. Those provisions provide in part:

 

 

The Commission shall, without limitation on the powers conferred in the preceding section, include within its regulations the following specific provisions in accordance with the provisions of the act;

 

… .

 

f. Defining and limiting the areas of operation, the rules of authorized games, odds, and devices permitted, and the method of operation of such games and devices; ….

 

 

 

 

Pursuant to these statutes, the Commission has promulgated exhaustive rules on the playing of blackjack. N.J.A.C. 19:47-2.1 to -2.13. These rules cover every conceivable aspect of the game, from determining how the cards are to be shuffled and cut, N.J.A.C. 19:47-2.5, to providing that certain cards shall not be dealt “until the dealer has first announced ‘Dealer’s Card’ which shall be stated by the dealer in a tone of voice calculated to be heard by each person at the table.” N.J.A.C. 19:47-2.6(g). It is no exaggeration to state that the Commission’s regulation of blackjack is more extensive than the entire administrative regulation of many industries.

 

These exhaustive statutes and regulations make clear that the Commission’s control over the rules and conduct of licensed casino games is intended to be comprehensive. The ability of casino operators to determine how the games will be played would undermine this control and subvert the important policy of ensuring the “credibility and integrity of the regulatory process and of casino operations.” N.J.S.A. 5:12-1(b). The Commission has promulgated the blackjack rules that give Uston a comparative advantage, and it has sole authority to change those rules. There is no indication that Uston has violated any Commission rule on the playing of blackjack. N.J.A.C. 19:47-2.1 to -2.13. Put simply, Uston’s gaming is “conducted according to rules promulgated by the Commission.” N.J.S.A. 5:12-100(e). Resorts has no right to exclude Uston on grounds that he successfully plays the game under existing rules.3

 

The Attorney General interpreted s 71 to be a tightly circumscribed intrusion on common law rights. We need not determine whether s 71, standing alone, would give the Commission the authority to exclude card counters. Cf. Uston v. Hilton Hotels Corp., 448 F.Supp. 116 (D.Nev.1978) (interpreting Nevada statute virtually identical to s 71 as having no bearing on whether card-counters can be excluded from casinos).

 

 

 

III

 

 

 

Resorts claimed that it could exclude Uston because it had a common law right to exclude anyone at all for any reason. While we hold that the Casino Control Act precludes Resorts from excluding Uston for the reasons stated, it is important for us to address the asserted common law right for two reasons. First, Resorts’ contentions and the Commission’s position concerning the common law right are incorrect. Second, the act has not completely divested Resorts of its common law right to exclude.

 

The right of an amusement place owner to exclude unwanted patrons and the patron’s competing right of reasonable access both have deep roots in the common law. See Arterburn, The Origin and First Test of Public Callings, 75 U. Pa. L. Rev. 411 (1927); Wyman, The Law of Public Callings as a Solution of the Trust Problem, 17 Harv. L. Rev. 156 (1904). In this century, however, courts have disregarded the right of reasonable access in the common law of some jurisdictions at the time the Civil War Amendments and Civil Rights Act of 1866 were passed.

 

As Justice Goldberg noted in his concurrence in Bell v. Maryland, 378 U.S. 226 (1964):

 

 

Underlying the congressional discussions and at the heart of the Fourteenth Amendment’s guarantee of equal protection, was the assumption that the State by statute or by “the good old common law” was obligated to guarantee all citizens access to places of public accommodation.

 

 

378 U.S. at 296, Goldberg, J., joined by Warren, C. J. and Douglas, J., concurring. See, e.g., Ferguson v. Gies, 82 Mich. 358 (1890) (after passage of the Fourteenth Amendment, both the civil rights statutes and the common law provided grounds for a non-white plaintiff to recover damages from a restaurant owner’s refusal to serve him, because the common law as it existed before passage of the civil rights laws “gave to the white man a remedy against any unjust discrimination to the citizen in all public places”); Donnell v. State, 48 Miss. 661 (1873) (state’s common law includes a right of reasonable access to all public places).

 

The current majority American rule has for many years disregarded the right of reasonable access,4 granting to proprietors of amusement places an absolute right arbitrarily to eject or exclude any person consistent with state and federal civil rights laws. See Annot., Propriety of exclusion of persons from horseracing tracks for reasons other than color or race, 90 A.L.R.3d 1361 (1979); Turner & Kennedy, Exclusion, Ejection and Segregation of Theater Patrons, 32 Iowa L. Rev. 625 (1947). See also Garifine v. Monmouth Park Jockey Club, 29 N.J. at 50, 148 A.2d 1.

 

At one time, an absolute right of exclusion prevailed in this state, though more for reasons of deference to the noted English precedent of Wood v. Leadbitter, 153 Eng.Rep. 351, (Ex.1845), than for reasons of policy. In Shubert v. Nixon Amusement Co., 83 N.J.L. 101 (Sup. Ct. 1912), the former Supreme Court dismissed a suit for damages resulting from plaintiff’s ejection from defendants’ theater. Noting that plaintiff made no allegation of exclusion on the basis of race, color or previous condition of servitude, the Court concluded:

 

 

In view of the substantially uniform approval of, and reliance on, the decision in Wood v. Leadbitter in our state adjudications, it must fairly be considered to be adopted as part of our jurisprudence, and whatever views may be entertained as to the natural justice or injustice of ejecting a theater patron without reason after he has paid for his ticket and taken his seat, we feel constrained to follow that decision as the settled law.

 

 

83 N.J.L. at 106, 83 A. 369.

 

It hardly bears mention that our common law has evolved in the intervening 70 years. In fact, Leadbitter itself was disapproved three years after the Shubert decision by Hurst v. Picture Theatres Limited, (1915) 1 K.B. 1 (1914). Of far greater importance, the decisions of this Court have recognized that “the more private property is devoted to public use, the more it must accommodate the rights which inhere in individual members of the general public who use that property.” State v. Schmid, 84 N.J. 535, 562 (1980).

 

State v. Schmid involved the constitutional right to distribute literature on a private university campus. The Court’s approach in that case balanced individual rights against property rights. It is therefore analogous to a description of the common law right of exclusion. Balancing the university’s interest in controlling its property against plaintiff’s interest in access to that property to express his views, the Court clearly refused to protect unreasonable exclusions. Justice Handler noted that

 

 

Regulations … devoid of reasonable standards designed to protect both the legitimate interests of the University as an institution of higher education and the individual exercise of expressional freedom cannot constitutionally be invoked to prohibit the otherwise noninjurious and reasonable exercise of [First Amendment] freedoms.

 

 

Id. at 567, 423 A.2d 615.

 

In State v. Shack, 58 N.J. 297 (1971), the Court held that although an employer of migrant farm workers “may reasonably require” those visiting his employees to identify themselves, “the employer may not deny the worker his privacy or interfere with his opportunity to live with dignity and to enjoy associations customary among our citizens.” Id. at 308. The Court reversed the trespass convictions of an attorney and a social services worker who had entered the property to assist farmworkers there.

 

Schmid recognizes implicitly that when property owners open their premises to the general public in the pursuit of their own property interests, they have no right to exclude people unreasonably. On the contrary, they have a duty not to act in an arbitrary or discriminatory manner toward persons who come on their premises. That duty applies not only to common carriers, Messenger v. Pennsylvania Railroad Co., 37 N.J.L. 531 (E. & A. 1874), innkeepers, see Garifine, supra, owners of gasoline service stations, Streeter v. Brogan, 113 N.J. Super. 486 (Ch. Div. 1971), or to private hospitals, Doe v. Bridgeton Hospital Ass’n, Inc., 71 N.J. 478 (1976), but to all property owners who open their premises to the public. Property owners have no legitimate interest in unreasonably excluding particular members of the public when they open their premises for public use.

 

No party in this appeal questions the right of property owners to exclude from their premises those whose actions “disrupt the regular and essential operations of the [premises],” State v. Schmid, 84 N.J. at 566 (quoting Princeton University Regulations on solicitation), or threaten the security of the premises and its occupants, see State v. Shack, 58 N.J. at 308. In some circumstances, proprietors have a duty to remove disorderly or otherwise dangerous persons from the premises. See Holly v. Meyers Hotel and Tavern, Inc., 9 N.J. 493, 495. These common law principles enable the casino to bar from its entire facility, for instance, the disorderly, the intoxicated, and the repetitive petty offender.

 

Whether a decision to exclude is reasonable must be determined from the facts of each case.5 Respondent Uston does not threaten the security of any casino occupant. Nor has he disrupted the functioning of any casino operations. Absent a valid contrary rule by the Commission, Uston possesses the usual right of reasonable access to Resorts International’s blackjack tables.

 

 

 

IV

 

 

 

Although the Commission alone has authority to exclude persons based upon their methods of playing licensed casino games, that authority has constitutional and statutory limits. We expressly decline to decide whether the Casino Control Act empowers the Commission to exclude card counters.

 

If the Commission decides to consider promulgating a rule banning card counters, it should review the statutory mandates regarding both the public policy of this State and the rules of licensed games. The Casino Control Act commands the Commission to regulate gambling with such “limitations as may be necessary to assure the vitality of casino operations and fair odds to and maximum participation by casino patrons,” N.J.S.A. 5:12-100(e) (emphasis added). The Court recognizes that the goals of casino vitality, fair odds to all players and maximum player participation may be in conflict. It is the Commission which must strike the appropriate balance.

 

The Commission should also consider that the Legislature has declared as public policy of this state that “[c]onfidence in casino gaming operations is eroded to the extent the State of New Jersey does not provide a regulatory framework for casino gaming that permits and promotes stability and continuity in casino gaming operations.” N.J.S.A. 5:12-1(14). Moreover, “[a]n integral and essential element of the regulation and control of such casino facilities by the State rests in the public confidence and trust in the credibility and integrity of the regulatory process and of casino operations.” N.J.S.A. 5:12-1(6). The exclusion of persons who can play the licensed games to their advantage may diminish public confidence in the fairness of casino gaming. To the extent persons not counting cards would be mistakenly excluded, public confidence might be further diminished. However, the right of the casinos to have the rules drawn so as to allow some reasonable profit must also be recognized in any realistic assessment. The Commission should consider the potentially broad ramifications of excluding card counters before it seeks to promulgate such a rule. Fairness and the integrity of casino gaming are the touchstones.

 

 

 

V

 

 

 

In sum, absent a valid Commission regulation excluding card counters, respondent Uston will be free to employ his card-counting strategy at Resorts’ blackjack tables. There is currently no Commission rule banning Uston, and Resorts has no authority to exclude him for card counting. However, it is not clear whether the Commission would have adopted regulations involving card counters had it known that Resorts could not exclude Uston. The Court therefore continues the temporary order banning Uston from Resorts’ blackjack tables for 90 days from the date of this opinion. After that time, respondent is free to play blackjack at Resorts’ casino absent a valid Commission rule excluding him.

 

For affirmance -Justices Pashman, Clifford, Schreiber, Handler, and O’Hern-5.

 

For reversal -None.

 


    1. Uston has described his strategy and his alleged success at Atlantic City blackjack tables on broadcast media and in books. See Uston, Two Books on Blackjack.

 

    1. Since then an industry-wide policy has developed to ban card counters. Each casino maintains its own list of persons to be barred as card counters.

 

    1. The Appellate Division relied on N.J.S.A. 5:12-71 (s 71) to establish the Commission’s right to exclude Uston. That provision directs the Commission to compile a list of persons to be excluded from gaming casinos whose presence in the casino would be inimical to the interests of casino gambling in New Jersey. N.J.S.A. 5:12-71(a)(3). The section applies to persons whose backgrounds or occupations indicate either criminal activity or actions hostile to the integrity of licensed casino gambling. We do not rely on this portion of the statute.

 

    1. The denial of freedom of reasonable access in some States following passage of the Fourteenth Amendment, and the creation of a common law freedom to arbitrarily exclude following invalidation of segregation statutes, suggest that the current majority rule may have had less than dignified origins. See Bell v. Maryland, supra.

 

    1. We need not decide whether the common law allows exclusion of those merely suspected of criminal activity, see Garifine, supra, 29 N.J. at 57, because the Casino Control Act clearly vests such decisions in the Commission alone. N.J.S.A. 5:12-71.

 

 

 

Brooks v. Chicago Downs Assoc.,

791 F.2d 512 (7th Cir. 1986)

 

 

 

Francis X. Grossi, Jr., Eric N. Landau, James E. Hanlon, Jr., Katten, Muchin, Zavis, Pearl & Galler, Chicago, Ill., for plaintiffs-appellants.

 

George S. Lalich, Nash & Lalich, Chicago, Ill., for defendant-appellee.

 

Before Cudahy, Flaum, and Easterbrook, Circuit Judges.

 

 

 

Flaum, Circuit Judge.

 

 

 

This is a case of first impression on whether under Illinois law the operator of a horse race track has the absolute right to exclude a patron from the track premises for any reason, or no reason, except race, color, creed, national origin, or sex. We find that Illinois follows the common law rule and would allow the exclusion. The court below is thus affirmed.

 

 

 

 

I

 

 

 

 

Plaintiffs are citizens of Pennsylvania who have formed a Pennsylvania partnership whose sole purpose is to pool the assets of the partners in order to place bets at horse racing tracks throughout the country. The plaintiffs are self-proclaimed expert handicappers, even though on the approximately 140 days they have bet at various race tracks they have ended up with net losses on 110 of those days. This case is about a bet they were not allowed to make.

 

The defendant is a private Illinois corporation licensed by the State of Illinois to conduct harness racing at Sportsman’s Park race track in Cicero, Illinois. At various times during the racing season, Sportsman’s Park conducts a parimutual pool known as “Super Bet.” In order to win the Super Bet pool, one must select the first two finishers of the fifth and sixth races and the first three finishers of the seventh race. The Super Bet pool is able to increase quickly and substantially because if the pool is not won on any given day, the total amount wagered is rolled over and added to the Super Bet purse for the next racing date. For example, in April of 1985 the plaintiffs, using their method for handicapping horses, placed bets on the Super Bet totalling $60,000. They picked the right horses and took home approximately $600,000.

 

In late July, 1985 the president of Chicago Downs ordered two of the plaintiffs (Jeffrey Yass and Kenneth Brodie) barred from Sportsman’s Park just as they were seeking to place a $250,000 wager in the Super Bet. After the plaintiffs had been barred from Sportsman’s Park, the Park’s counsel informed them that they would be denied entry to all future racing dates at the Park. The plaintiffs then filed suit seeking injunctive relief that would prohibit the defendant from barring them from entering the race track premises. Sportsman’s Park filed a motion to dismiss the complaint on the ground that under Illinois law the operator of a proprietary race track has the absolute right to exclude a patron from the track premises for any reason except race, creed, color, national origin, or sex. The trial court agreed with the defendants and granted their motion to dismiss, from which the plaintiffs now appeal. We affirm.

 

 

 

 

II

 

 

 

 

… .

 

The parties do not contest the Illinois Supreme Court’s holding that a race track operator has the right to exclude patrons for good cause. Phillips v. Graham, 86 Ill.2d 274, 56 Ill.Dec. 355, 427 N.E.2d 550 (1981). But in this case, the race track argues that it should be able to exclude a patron absent any cause at all, as long as it does not do so on the basis of race, color, creed, national origin, or sex. Under the defendant’s theory, because the race track is a privately owned place of amusement it may exclude someone simply for wearing a green hat or a paisley tie. It need give no reason for excluding the patron, under its version of the common law, because it is not a state-granted monopoly, but a state-regulated licensee operating on private property.

 

The most recent Illinois Supreme Court case to touch on this issue was Phillips v. Graham, 86 Ill.2d 274, 56 Ill.Dec. 355, 427 N.E.2d 550 (1981). In Phillips several harness racing drivers, owners, and trainers were excluded by formal Order of the State Racing Board from all race tracks in the state because they had been indicted for bribery. The Illinois Supreme Court … held that the authority given organization licensees (such as race tracks) to exclude occupation licensees (such as jockeys) from their private property was not an unconstitutional delegation of legislative power. Paragraph 9(e) of the Illinois Horse Racing Act of 1975 states:

 

 

The power to eject or exclude occupation licensees [trainers, jockeys, owners, etc.] may be exercised for just cause by the organization licensee [race track] or Board subject to subsequent hearing by the Board, as to the propriety of said exclusion.

 

 

Ill.Rev.Stat., ch. 8, par. 37-9(e) (1985). The addition of this section to the Act followed closely on the heels of Cox v. National Jockey Club, 25 Ill.App.3d 160, 323 N.E.2d 104 (1974) and apparently codifies its holding.

 

… .

 

The Cox court differentiated between the right of a track to exclude a licensee and its right to bar a patron. The track had argued that its common law right to exclude a patron without reason applied equally to a licensee. Although acknowledging precedent which held that the track could exclude a patron without reason or justification, the court refused to extend that authority to cover a licensee … .

 

The language of Phillips and Cox lead us to conclude that Illinois follows the common law rule regarding the exclusion of patrons, as opposed to the exclusion of licensees which is governed by the “just cause” rule codified in 9(e). Of the cases cited by the Illinois courts as demonstrating the common law rule, Madden v. Queens County Jockey Club, 296 N.Y. 249, 72 N.E.2d 697 (Ct.App.), cert. denied, 332 U.S. 761, 68 S.Ct. 63, 92 L.Ed. 346 (1947), is the most explicit and most cited. The plaintiff, “Coley” Madden, who claimed to be a professional “patron of the races,” was barred from the defendant’s Aqueduct Race Track under the mistaken belief that he was “Owney” Madden, reputed to be the fabled Frank Costello’s bookmaker. Coley Madden brought suit for declaratory judgment and contended that as a citizen and taxpayer he had the right to enter the track and patronize the races. The defendant moved to dismiss on the ground that it had an unlimited right of exclusion. The trial court granted plaintiff’s motion and entered an order enjoining the defendant from barring Coley Madden from its race track. The appellate division reversed, 269 App.Div. 644, 58 N.Y.S.2d 272, and the New York Court of Appeals affirmed the appellate division’s reversal of the trial court. The Court of Appeals framed the question: “Whether the operator of a race track can, without reason or sufficient excuse, exclude a person from attending its races.” 72 N.E.2d at 698. Its answer: “In our opinion he can; he has the power to admit as spectators only those whom he may select, and to exclude others solely of his own [volition,] as long as the exclusion is not founded on race, creed, color or national origin.” 72 N.E.2d at 698.

 

The court went on to explain the common law:

 

 

At common law a person engaged in a public calling, such as innkeeper or common carrier, was held to be under a duty to the general public and was obliged to serve, without discrimination, all who sought service. [Citations omitted.] On the other hand, proprietors of private enterprises, such as places of amusement and resort, were under no such obligation, enjoying an absolute power to serve whom they pleased. [Citations omitted.] A race track, of course, falls within that classification.

 

 

72 N.E.2d at 698 (emphasis added).

 

… .

 

In holding that Illinois follows the traditional common law rule we are not unmindful that several other states have questioned that rule as a matter both of law and of policy. For example, many of the states that follow the common law rule have used language broader than the facts in the case before them required. While these cases state that a proprietor has the absolute right to exclude, the facts of the case show that just cause existed to exclude the patron. See, e.g., Silbert v. Ramsey, 301 Md. 96, 482 A.2d 147 (1984) (patron excluded on the basis of his prior conviction for violation of state lottery laws); James v. Churchill Downs, Inc., 620 S.W.2d 323 (Ky.App.1981) (excluded patron was a convicted bookmaker); Tropical Park, Inc. v. Jack, 374 So.2d 639 (Fla.App.1979) (patron alleged to have “known underworld connections” was rightfully excluded); Burrillville Racing Association v. Garabedian, 113 R.I. 134, 318 A.2d 469 (1974) (excluded patron had prior conviction for income tax evasion in connection with a wager messenger operation); People v. Licata, 28 N.Y.2d 113, 268 N.E.2d 787 (1971) (defendant had prior convictions for bookmaking); Flores v. Los Angeles Turf Club, Inc., 55 Cal.2d 736, 13 Cal.Rptr. 201, 361 P.2d 921 (1961) (plaintiff was a convicted bookmaker). But that fact only demonstrates that proprietors of amusement facilities, whose very survival depends on bringing the public into their place of amusement, are reasonable people who usually do not exclude their customers unless they have a reason to do so. What the proprietor of a race track does not want to have to do is prove or explain that his reason for exclusion is a just reason. He doesn’t want to be liable to Coley Madden solely because he mistakenly believed he was a mobster. The proprietor wants to be able to keep someone off his private property even if they only look like a mobster. As long as the proprietor is not excluding the mobster look-a-like because of his national origin (or because of race, color, creed, or sex), then the common law, and the law of Illinois, allows him to do just that.

 

We also choose not to follow the arguable – but not clear – abandonment of the common law rule in New Jersey in the case of Uston v. Resorts International Hotel, Inc., 89 N.J. 163, 445 A.2d 370 (1982). In 1959 the New Jersey Supreme Court decided Garifine v. Monmouth Park Jockey Club, 29 N.J. 47, 148 A.2d 1 (Sup.Ct.1959), which was an appeal from the trial court’s refusal to grant the plaintiff injunctive relief from his exclusion from Monmouth Park race track. The defendant race track, relying on Madden, moved to dismiss the complaint on the ground that it had “an absolute right” to exclude the plaintiff. On appeal, the plaintiff contended that the operator of a race track should not have the common law right to exclude a patron without reasonable cause and that under the New Jersey Civil Rights Act the operator did not have such authority. In a scholarly opinion the court traced the genesis of the right of race tracks to exclude patrons without justifying the exclusion:

 

 

There was a time in English history when the common law recognized in many callings the duty to serve the public without discrimination. [Citations omitted.] With the passing of time and the changing of conditions, the common law confined this duty to exceptional callings where the needs of the public urgently called for its continuance. Innkeepers and common carriers may be said to be the most notable illustrations of business operators who, both under early principles and under the common law today, are obliged to serve the public without discrimination. [Citations omitted.] On the other hand, operators of most businesses, including places of amusement such as race tracks, have never been placed under any such common-law obligation, for no comparable considerations of public policy have ever so dictated. See Madden v. Queens County Jockey Club, 296 N.Y. 249, 72 N.E.2d 697, 1 A.L.R.2d 1160 (Ct.App.1947), cert. denied 332 U.S. 761, 68 S.Ct. 63, 92 L.Ed. 346 (1947); Greenfield v. Maryland Jockey Club, 190 Md. 96, 57 A.2d 335 (Ct.App.1948). Cf. Marrone v. Washington Jockey Club, 227 U.S. 633, 33 S.Ct. 401, 57 L.Ed. 679 (1913)….

 

 

 

No holdings contrary to the foregoing have been cited by the plaintiff; and although he has urged that the defendant’s common-law right of exclusion from its race track should be limited because as a licensee “it has secured the advantage of a State monopoly” we find no force in his contention. See Madden v. Queens County Jockey Club, supra; Greenfeld v. Maryland Jockey Club, supra.… The burden of the plaintiff’s present attack is on the common-law doctrine which he states should be altered to afford to him a right of admission to the race track in the absence of affirmative legal proof by the defendant that there is good cause for his exclusion. We are satisfied that, without regard to views which may be entertained in other types of cases, there has been no showing made here for such alteration….

 

 

148 A.2d at 6-7. However, in 1982 the New Jersey Supreme Court decided Uston in which the plaintiff was a practitioner of a strategy of playing blackjack known as “card counting.” The defendant operated a gambling casino licensed pursuant to the New Jersey Casino Control Act. The defendant excluded Uston from the blackjack tables in its casino because of Uston’s strategy of “card counting.” The New Jersey Supreme Court held that the Casino Control Act gave the Casino Control Commission the exclusive authority to exclude patrons based upon their strategies for playing licensed casino games and that any common law right the defendant may have had to exclude Uston for these reasons was abrogated by the Act and outweighed by Uston’s right of access. Uston, 445 A.2d at 372.

 

In Marzocca v. Ferone, 93 N.J. 509, 461 A.2d 1133 (1983), the owner of a harness race horse was barred from racing that horse at Freehold Raceway in New Jersey. The appellate court determined that Uston overruled Garifine v. Monmouth Park Jockey Club, sub silentio, and remanded the case to the trial court to hear evidence as to whether the race track’s exclusion was reasonable. The case was then appealed to the New Jersey Supreme Court, where the court clarified its decision in Uston and reversed the appellate court, stating:

 

 

Notwithstanding the dicta in Uston, we must part company with the court below on the issue of Freehold’s right to exclude. Without commenting on the status of the law in the amusement owner/patron context, we hold that the racetrack’s common law right to exclude exists in the context of this case, i.e., where the relationship [is] between the track management and persons who wish to perform their vocational activities on the track premises.

 

 

461 A.2d at 1137. Therefore, it is clear that New Jersey has not per se abandoned the common law rule but has adapted it, in a limited fashion, to the particular needs of its casino industry. New Jersey has not gone as far as Illinois did in Cox, and in the Illinois Racing Statute, but they give no reason why the patron is more protected than the licensee. The law of New Jersey does not directly conflict with the law of Illinois that we inferred from Phillips and Cox, but to the extent that it is different, the differences are further evidence that Illinois follows the common law approach.

 

However, the New Jersey decisions do paint the wider policy picture of which our decision today is a part. As a policy matter, it is arguably unfair to allow a place of amusement to exclude for any reason or no reason, and to be free of accountability, except in cases of obvious discrimination. In this case, the general public is not only invited but, through advertising, is encouraged to come to the race track and wager on the races’ outcome. But the common law allows the race track to exclude patrons, no matter if they come from near or far, or in reasonable reliance on representations of accessibility. We may ultimately believe that market forces would preclude any outrageous excesses – such as excluding anyone who has blond hair, or (like the plaintiffs) who is from Pennsylvania, or (even more outrageous) who has $250,000 to spend in one day of betting. But the premise of the consumer protection laws that the New Jersey Supreme Court alluded to in Uston and Marzocca recognizes that the reality of an imperfect market allows numerous consumer depredations. Excluding a patron simply because he is named Adam Smith arguably offends the very precepts of equality and fair dealing expressed in everything from the antitrust statutes to the Illinois Consumer Fraud and Deceptive Business Practice Act. Ill.Rev.Stat. ch. 121­, ¶¶ 262-72.

 

But the market here is not so demonstrably imperfect that there is a monopoly or any allegation of consumer fraud. Consequently, there is no such explicit legislative directive in the context of patrons attending horse races in Illinois – so the common law rule, relic though it may be,1 still controls. Therefore, within the prohibitions of Erie, the language of the Illinois cases, and the lack of language from the Illinois legislature, we hold that the common law rule is the law of Illinois.

 

 

 

 

III

 

 

 

 

For the foregoing reasons the court below is affirmed.

 


    1. As the New Jersey Supreme court noted in Uston, the rise of the American common law right to exclude without cause alarmingly corresponds to the fall of the old segregation laws. However, that is clearly not an issue in this case because the legislature has justly limited the absolute right to exclude to cases not involving exclusion based on race, creed, color, national origin, or sex. Uston, 445 A.2d at 374 n. 4.

 

 

 

Donovan, Appellant (Plaintiff below), v. Grand Victoria Casino & Resort, L.P.G,

934 NE 2d 1111 (Ind., Sep. 30, 2010)

 

 

 

Marc S. Sedwick Indianapolis, Indiana, ATTORNEY FOR APPELLANT.

 

Peter J. Rusthoven Paul L. Jefferson Matthew S. Winings Indianapolis, Indiana, ATTORNEYS FOR APPELLEE.

 

Fred R. Biesecker John J. Thar Jenny R. Wright Indianapolis, Indiana, ATTORNEYS FOR AMICUS CURIAE CASINO ASSOCIATION OF INDIANA.

 

 

 

Sullivan, Justice.

 

 

 

An owner of an Indiana business has long had the absolute right to exclude a visitor or customer, subject only to applicable civil rights laws. This long-standing common law right of private property owners extends to the operator of a riverboat casino that wishes to exclude a patron for employing strategies designed to give the patron a statistical advantage over the casino. The Riverboat Gambling Act, which gives the Indiana Gaming Commission exclusive authority to set the rules of licensed casino games, does not abrogate this common law right.

 

 

 

 

Background

 

 

 

 

Grand Victoria Casino & Resort, L.P. (“Grand Victoria”), owns and operates a riverboat casino located in Rising Sun, Indiana. One of the games offered by Grand Victoria is blackjack. Thomas P. Donovan supplements his income by playing blackjack in casinos. Donovan is a self-described “advantage player” who taught himself a strategy known as “card counting” that he employs when playing blackjack. Card counters keep track of the playing cards as they are dealt and adjust their betting patterns when the odds are in their favor. When used over a period of time, this method presumably ensures a more profitable encounter with the casino.

 

For a time, Grand Victoria allowed Donovan to play blackjack and card count if he wagered no more than $25 per hand. However, on August 4, 2006, Grand Victoria’s director of table games advised Donovan that Grand Victoria had decided to ban Donovan from playing blackjack, though Donovan would still be allowed to play other casino games. After Donovan indicated that he would not comply with Grand Victoria’s request, he was evicted and placed on Grand Victoria’s list of excluded patrons.

 

Donovan filed suit against Grand Victoria, alleging breach of contract and seeking a declaratory judgment that Grand Victoria could not exclude him from playing the game of blackjack for counting cards. The trial court granted summary judgment in favor of the casino on both counts.

 

Donovan appealed. The Court of Appeals affirmed summary judgment for Grand Victoria on the breach of contract claim,1 but it reversed summary judgment on the exclusion issue, holding that Donovan was entitled to a declaratory judgment that Grand Victoria had no right to exclude Donovan from blackjack for counting cards… . .

 

 

 

 

Discussion

 

 

 

 

… .

 

One of the time-honored principles of property law is the absolute and unconditional right of private property owners to exclude from their domain those entering without permission. See Brooks v. Chi. Downs Ass’n, 791 F.2d 512, 515-16 (7th Cir. 1986) (citations omitted); see also 2 William Blackstone, Commentaries on the Laws of England 2 (1766) (defining private property as “that sole and despotic dominion which one man claims and exercises over the external things of the world, in total exclusion of the right of any other individual in the universe”). In Bailey v. Washington Theatre Co., this common law right was explicitly extended to proprietors of privately owned amusements. 34 N.E.2d 17, 19 (1941). The patron in Bailey had sought an order compelling access to a privately owned theatre. In denying the patron relief, this Court held that ”’[t]he proprietor of a theater, unlike a carrier of passengers, is engaged in a strictly private business. He is under no implied obligation to serve the public and … is under no duty to admit everyone who may apply and be willing to pay for a ticket.’” Id. (citation omitted). This long-standing principle of property law has been frequently reaffirmed, subject only to statutorily imposed prohibitions on exclusions for characteristics such as race and religion. Id.; see also Brooks, 791 F.2d at 515-16. But we have never had occasion to explore the application of this rule to the riverboat casino industry, which is the precise issue in this appeal.

 

Donovan’s principal contention is that any common law right that casinos might enjoy to exclude patrons from its premises has been preempted by the Indiana Gaming Commission’s (“IGC’s”) exhaustive regulation of the riverboat casino industry, especially its comprehensive regulation of every aspect of the game of blackjack. Grand Victoria responds that nothing in the Indiana Riverboat Gambling Act purports to abrogate common law exclusion rights; thus, absent express direction from the Legislature, the right remains intact.

 

… .

 

We find the reasoning of Justice Gudgel of the Kentucky Court of Appeals in James persuasive:

 

 

[T]he legislature possesses the power to abrogate a common law right by enacting a specific statute which accomplishes that purpose. However, for us to conclude, as appellants have, that the mere enactment of statutes which confer upon the racing commission the authority to exercise a right of exclusion has the effect of abrogating the authority of racetrack proprietors to exercise an identical common law right they possess is unwarranted.

 

 

Id. at 325. We agree.2 Grand Victoria enjoyed the common law right to exclude Donovan.

 

… .

 

Lastly, Donovan urges Indiana to adopt the New Jersey Supreme Court’s decision of Uston v. Resorts Int’l Hotel, Inc., 445 A.2d 370 (N.J. 1982). Uston had been excluded from a New Jersey casino for card counting. Id. at 372. Like Donovan, Uston argued that a casino’s common law right arbitrarily to evict patrons from its premises had been preempted by exhaustive gaming regulations governing New Jersey’s casino industry. The Uston court held that the Casino Control Act gave New Jersey’s gaming commission the exclusive authority to exclude patrons based upon their strategies for playing licensed casino games and that any common law right the casino may have had to exclude Uston for these reasons was abrogated by the Act and outweighed by Uston’s right of access. Id.

 

The statutory language supporting the court’s holding provided that the commission “shall establish such minimum wagers and other limitations as may be necessary to assure the vitality of casino operations and fair odds to and maximum participation by casino patrons.” Id. The court noted that the New Jersey Act went into great detail in defining the rules of blackjack, and only the commission had authority to alter these rules. Id. at 373. Following this line of reasoning, the court found that the casinos had changed the rules of the game by excluding patrons based upon their method of play or their level of success. Id. The court ultimately concluded that such exclusions contravened the Legislature’s express intent for the enactment of New Jersey’s Casino Control Act: “[T]o assure … maximum participation by casino patrons.” Id. at 372-73.

 

Indiana courts have never recognized a public right of access to private property. See Wilhoite v. Melvin Simon & Assocs., Inc., 640 N.E.2d 382, 385 (Ind. Ct. App. 1994) (“There is no law, rule, or understanding stemming from Indiana law, federal law or other source creating a right to be admitted to private property.”) In fact, Wilhoite rebuffed the view “that because [a proprietor] opens itself to the public, it loses its character as private property.” Id. at 387 (citing Lloyd Corp. v. Tanner, 407 U.S. 551, 570 (1972) (“Nor does property lose its private character merely because the public is generally invited to use it for designated purposes.”)). And in contrast to the express intent for the enactment of New Jersey’s Casino Control Act, our Legislature chose to legalize riverboat gambling “to benefit the people of Indiana by promoting tourism and assisting economic development,” I.C. § 4-33-1-2, not to ensure maximum participation by casino patrons.

 

Acknowledging this lack of congruence between the two states’ gaming statutes, Donovan argues that Grand Victoria opened its premises to the general public for tourism purposes and the arbitrary exclusion of patrons neither promotes tourism nor economic development. We are not persuaded. It seems to us just as likely – if not more so – that discouraging card counting enhances a casino’s financial success and directly furthers the Legislature’s express objective of promoting tourism and assisting economic development. In point of fact, New Jersey has come to recognize that card counting can threaten economic development. See Campione v. Adamar of N.J., Inc., 714 A.2d 299, 305 (N.J. 1998) (acknowledging that gaming commission regulations sanctioning the use of card counting countermeasures were intended “to minimize the perceived threat of card counters to the statistical advantage that casinos need to remain profitable”).

 

Other considerations counsel against adopting the position Donovan advances. In Brooks, the Seventh Circuit recognized that although it is “arguably unfair” to allow a place of amusement arbitrarily to exclude patrons, 791 F.2d at 518, there are sound public policy reasons in support of the common law rule of exclusion:

 

 

[P]roprietors of amusement facilities, whose very survival depends on bringing the public into their place of amusement, are reasonable people who usually do not exclude their customers unless they have a reason to do so. What the proprietor of a race track does not want to have to do is prove or explain that his reason for exclusion is a just reason.

 

 

791 F.2d at 517 (emphasis omitted). In the words of the Arizona Court of Appeals,

 

 

We are not persuaded that the common law rule of exclusion should be changed. The policy upon which it is based is still convincing. The [casino] proprietor must be able to control admission to its facilities without risk of a lawsuit and the necessity of proving that every person excluded would actually engage in some unlawful activity.

 

 

Nation, 579 P.2d at 582; see also Brief of Amicus Curiae at 8 (“Such decisions are, and should be, matters of business judgment to be evaluated and remedied by competitive market forces, not courts.”).

 

 

 

Dickson, Justice, dissenting.

 

 

 

I disagree with the Court’s foundational premise that gambling casinos are entitled to the same common law right of arbitrary exclusion as possessed by proprietors of conventional businesses at common law. The privilege of operating a casino exists in Indiana only by recent special enactments of the Indiana General Assembly, and such operation is dependent upon specific authorization and comprehensive regulation of the Indiana Gaming Commission. It is only through the grace of such legislative and administrative permission that casinos exist in Indiana and are licensed and permitted to seek a profit by inviting the general public to participate in games that offer the prospect of reward for success. Permitting a casino to restrict its patrons only to those customers who lack the skill and ability to play such games well intrudes upon principles of fair and equal competition and provides unfair financial advantages and rewards to casino operators. I am not persuaded that such schemes are supported or protected by any common law right or privilege.

 

I believe the analysis and conclusion of the Court of Appeals is correct in this case. Donovan v. Grand Victoria Casino & Resort, L.P., 915 N.E.2d 1001 (Ind. Ct. App. 2009). It recognized the historic prohibition against gambling within Indiana’s borders until selectively permitted in the past two decades and that it remains subject to “strict regulation.” See Ind. Code § 4-33-4-2. The Indiana Gaming Commission, granted the exclusive authority to set rules of riverboat casino games, did not enact any prohibition against card counting nor did the defendant casino request Commission approval of such a rule. Card counting is not illegal under the exhaustive set of blackjack regulations promulgated by the Gaming Commission. See 68 Ind. Admin. Code 10-2-14. The regulations permit a riverboat licensee to impose additional blackjack rules but only if deemed necessary “to ensure the integrity of the game.” 68 I.A.C. 10-2-2(b). I find that targeting unskilled blackjack players and excluding gifted ones is grossly incompatible with the integrity of the game.

 

The comprehensive, exclusive authority of the Indiana Gaming Commission is the basis of this Court’s decision today in Caesars Riverboat Casino, LLC v. Kephart, 934 N.E.2d 1120 (Ind. 2010). The Court in Kephart finds that Indiana’s statutory scheme of riverboat gambling regulation and the plaintiff’s common law claim in that case are “so incompatible that they cannot both occupy the same space.” Id. slip opin. at 6. If this is so, the same principle should be applied here. I dissent in Kephart, however, believing that the common law cause of action by an injured customer against a business operator failing to exercise reasonable care has not been expressly or unmistakably abrogated by Indiana’s gambling statutes. But in the present case, I conclude that, because Indiana’s gambling casino businesses exist only by statute and regulation, they are governed exclusively by the Commission’s regulatory authority and not by common law.

 

I agree with the Court of Appeals conclusion that Grand Victoria should not be allowed to exclude the plaintiff from playing blackjack simply because the casino fears that he may be exceptionally good at it.

 


    1. This issue has not been raised on transfer by either party. We summarily affirm the Court of Appeals. Ind. App. R. 58(A)(2).

 

    1. This does not mean that the comprehensive regulatory scheme enacted by the Legislature and implemented by the IGC did not abrogate any of the common law. See Caesars Riverboat Casino, LLC v. Kephart, 934 N.E.2d 1120, No. 31S01-0909-CV-00403, slip op. (Ind. Sept. 30, 2010) (holding that the regulatory scheme abrogated any putative common law duty of casinos to protect compulsive gamblers). In this case, Donovan argues that because the regulatory scheme does not prohibit card counting, the common law right to exclude is abrogated. But while the common law duty on the part of a casino to exclude a compulsive gambler is incompatible with the regulatory scheme at issue in Kephart because the regulation imposes a duty instead on the gambler to register, there is nothing that makes the common law right to exclude incompatible, or even in conflict with, the regulatory scheme at issue in this case. The regulation here dictates the rules of the game of blackjack but in no way conflicts with or limits a casino from excluding smokers or college students or provocative dressers – or card counters.

 

 

 

 

 

7.3.2. Civil Rights Acts

 

Dale v. Boy Scouts of America,

160 N.J. 562 (1999)

 

 

 

George A. Davidson, a member of the New York bar, New York City, for defendants-appellants and cross-respondents (Cerrato, Dawes, Collins, Saker & Brown, attorneys, Freehold; Mr. Davidson, Sanford D. Brown, Freehold and Carla A. Kerr, a member of the New York bar, New York City, on the briefs).

 

Evan Wolfson, a member of the New York bar, New York City, for plaintiff-respondent and cross-appellant (Lewis H. Robertson, attorney, Red Bank; Mr. Wolfson, Mr. Robertson and Thomas J. Moloney, a member of the New York bar, New York City, on the briefs).

 

 

 

The opinion of the Court was delivered by Poritz C.J.

 

 

 

In 1991, the New Jersey Legislature amended the Law Against Discrimination (LAD), N.J.S.A. 10:5-1 to -49, to include protections based on “affectional or sexual orientation.” This case requires us to decide whether that law prohibits Boy Scouts of America (BSA) from expelling a member solely because he is an avowed homosexual.

 

Defendants BSA and Monmouth Council (collectively Boy Scouts) seek review of a decision of the Appellate Division holding that: (1) Boy Scouts is a place of public accommodation as defined by the LAD; (2) Boy Scouts’ expulsion of plaintiff James Dale, an assistant scoutmaster, based solely on the club’s policy of excluding avowed homosexuals from membership is prohibited by the LAD; and (3) the LAD prohibition does not violate Boy Scouts’ First Amendment rights. Plaintiff, James Dale, seeks certification on his common law claim, dismissed by the Appellate Division. We granted both parties’ petitions, 156 N.J. 381, 718 A.2d 1210, 156 N.J. 382, 718 A.2d 1210 (1998), and now affirm.

 

… .

 

James Dale first became a BSA member in 1978 when, at the age of eight, he joined Monmouth Council’s Cub Scout Pack 142. He remained a Cub Scout until 1981, when he became a member of Boy Scout Troop 220, also in Monmouth Council. He joined Monmouth Council’s Boy Scout Troop 128 in 1983, and Troop 73 in 1985. Until his eighteenth birthday in 1988, he remained a youth member of Troop 73.

 

Dale was an exemplary scout. Over the ten years of his membership, he earned more than twenty-five merit badges. In 1983, he was admitted into Boy Scouts’ Order of the Arrow, the organization’s honor camping society, and achieved the status of Virgil Honor. The pinnacle of Dale’s career as a youth member came in 1988, when BSA awarded him an Eagle Scout Badge, an honor achieved by only the top three percent of all scouts.

 

Dale’s participation in Boy Scout leadership began at an early age. Throughout his years as a member, Dale was an assistant patrol leader, patrol leader, and bugler, and from 1985 to 1988, Dale served as a Junior Assistant Scoutmaster for Troop 73. He was also invited to speak at organized Boy Scout functions, such as the Joshua Huddy Distinguished Citizenship Award Dinner, and attended national events, including the National Boy Scout Jamboree. On March 21, 1989, Dale sought adult membership in Boy Scouts. Monmouth Council and BSA accepted and approved his application for the position of Assistant Scoutmaster of Troop 73 where he served for approximately sixteen months.

 

At about the same time that Dale applied for adult membership, he left home to attend Rutgers University. While at college, Dale first acknowledged to himself, and to his family and friends, that he was gay. Shortly thereafter, he became involved with, and eventually became the co-president of the Rutgers University Lesbian/Gay Alliance. Then, in July 1990, Dale attended a seminar that addressed the psychological and health needs of lesbian and gay teenagers. The Star-Ledger interviewed Dale and published an article on July 8, 1990 that discussed the seminar. The article included Dale’s photograph and a caption identifying him as “co-president of the Rutgers University Lesbian/Gay Alliance.” Kinga Borondy, Seminar Addresses Needs of Homosexual Teens, Star-Ledger (Newark), July 8, 1990, § 2, at 11.

 

Later that month, Dale received a letter from Monmouth Council Executive James W. Kay, revoking his BSA membership. The letter asked Dale to “sever any relations [he] may have with the Boy Scouts of America,” and granted Dale sixty days to request a review of his termination from the Monmouth Council Regional Review Committee.

 

Dale wrote to Kay on August 8, 1990, and requested the basis for the Monmouth Council’s decision. In a letter dated August 10, 1990, Kay notified Dale that the “grounds for [his] membership revocation” were “the standards for leadership established by the Boy Scouts of America, which specifically forbid membership to homosexuals.”1 On September 30, 1990, Dale wrote a letter to the Northeast Regional Director, Rudy Flythe, asking for a review of his membership decision and a copy of BSA’s leadership standards. Dale also requested permission to attend the review, a right to which he was entitled under the Monmouth Council Review Procedures. The Regional Review Committee acknowledged receipt of Dale’s request, but neglected to provide him with a copy of the BSA standards for leadership or a review date.

 

In another letter dated October 16, 1990, Dale once again asked for a copy of the leadership standards and notice of the review date. On November 27, 1990, Charles Ball, the Assistant Regional Director of the Northeast Region, notified Dale that the “Northeast Region, [BSA] Review Committee supports the decision of the Monmouth Council … to deny your registration with [BSA],” and granted Dale thirty days to seek review by the National Council Review Committee. Three weeks later, through counsel, Dale wrote to the Chief Scout Executive of BSA and requested a rehearing and an opportunity to attend the review. BSA’s counsel informed Dale on December 21, 1990, that he had been denied the right to attend because: “[BSA] does not admit avowed homosexuals to membership in the organization so no useful purpose would apparently be served by having Mr. Dale present at the regional review meeting.” BSA did agree, however, to have the National Council review Dale’s membership revocation. Because Dale believed that a National Council review “would be futile,” he initiated these legal proceedings.

 

… .

 

On July 29, 1992, Dale filed a six-count complaint against BSA and Monmouth Council in the Superior Court of New Jersey. Dale alleged that Boy Scouts had violated the New Jersey Law Against Discrimination and common law by revoking his membership based solely on his sexual orientation. He sought declaratory, injunctive, compensatory and punitive monetary relief, as well as costs and attorney fees.

 

… .

 

Dale moved for partial summary judgment in September 1993, demanding immediate reinstatement based on his claim that defendants had violated the LAD and New Jersey’s public policy. Defendants, in response, cross-moved for summary judgment on all counts. The court denied Dale’s motion and granted Boy Scouts’ cross-motion. Dale v. Boy Scouts of Am., No. MON-C-330-92 (Ch. Div. Nov. 3, 1995). After concluding that Dale was “a sexually active homosexual,” the court found that Boy Scouts had always had a policy of excluding “active homosexual[s].” Id. at 6, 38. The court opined that homosexual acts are immoral and attributed to Boy Scouts a longstanding antipathy toward such behavior. Id. at 39-40. In the judge’s view, “[i]t [was] unthinkable … that the BSA could or would tolerate active homosexuality if discovered in any of its members.” Id. at 40.

 

As to the applicability of the LAD, the court held that Boy Scouts was not a place of public accommodation, or alternatively, that Boy Scouts was exempt under the “distinctly private” exception found at N.J.S.A. 10:5-5l. Id. at 55. The court rejected Dale’s common law claim, finding that the State’s policy “is that established by the NJLAD … [and] not some prior common law policy.” Id. at 45. Because the court believed that Boy Scouts’ moral position in respect of active homosexuality was clear, it found that Boy Scouts’ First Amendment freedom of expressive association “prevent[ed] government from forcing [the organization] to accept Dale as an adult leader-member.” Id. at 71.

 

The Appellate Division affirmed the dismissal of Dale’s common law claim, but otherwise reversed and remanded for further proceedings. Dale v. Boy Scouts of Am., 308 N.J.Super. 516, 523, 706 A.2d 270 (App.Div.1998).

 

… .

 

A.The LAD

 

We first consider whether Boy Scouts is subject to the LAD, which provides that “[a]ll persons shall have the opportunity… to obtain all the accommodations, advantages, facilities, and privileges of any place of public accommodation, … without discrimination because of … affectional or sexual orientation.” N.J.S.A. 10:5-4. Boy Scouts must therefore abide by the LAD if Boy Scouts is a place of public accommodation and does not meet any of the LAD exceptions. See, e.g., N.J.S.A. 10:5-5l (exempting “distinctly private” entities, religious educational facilities, and parents or individuals acting “in loco parentis” in respect of “the education and upbringing of a child”).

 

 

 

 

1.Place of Public Accommodation

 

 

 

 

“[T]he overarching goal of the [LAD] is nothing less than the eradication ‘of the cancer of discrimination.’” Fuchilla v. Layman, 109 N.J. 319, 334, 537 A.2d 652 (quoting Jackson v. Concord Co., 54 N.J. 113, 124, 253 A.2d 793 (1969)), cert. denied, 488 U.S. 826, 109 S.Ct. 75, 102 L. Ed.2d 51 (1988). “[D]iscrimination threatens not only the rights and proper privileges of the inhabitants of [New Jersey,] but menaces the institutions and foundation of a free democratic State.” N.J.S.A. 10:5-3. In furtherance of its purpose to root out discrimination, the Legislature has directed that the LAD “shall be liberally construed.” Ibid. We have adhered to that legislative mandate by historically and consistently interpreting the LAD “‘with that high degree of liberality which comports with the preeminent social significance of its purposes and objects.’” Andersen v. Exxon Co., 89 N.J. 483, 495, 446 A.2d 486 (1982) (quoting Passaic Daily News v. Blair, 63 N.J. 474, 484, 308 A.2d 649 (1973)).

 

A clear understanding of the phrase “place of public accommodation” is critical. That is because “place of public accommodation” is, in large measure, determinative of the LAD’s scope. Certainly, if the statute is broadly applicable, the antidiscriminatory impact of its provisions is greater. The Legislature’s finding that the effects of discrimination are pernicious, and its directive to liberally construe the LAD, have informed our cases interpreting the reach of “place of public accommodation.”

 

 

 

 

a.Place

 

 

 

 

In 1965, the Court held that places of public accommodation were not limited to those enumerated in the statute. Fraser v. Robin Dee Day Camp, 44 N.J. 480, 486, 210 A.2d 208 (1965) (then N.J.S.A. 18:25-5(l)). At that time, the statutory definition used the word “include” to preface a list of specific “places” of public accommodation. See id. at 485, 210 A.2d 208. We reasoned that the Legislature’s choice of the word “include” indicated that the “places” expressly mentioned were “merely illustrative of the accommodations the Legislature intended to be within the scope of the statute. Other accommodations, similar in nature to those enumerated, were also intended to be covered.” Id. at 486, 210 A.2d 208. Less than a year later, the Legislature amended the LAD to expressly state that “‘a place of public accommodation’ shall include, but not be limited to” the various examples identified, L. 1966, c. 17 (emphasis added), thereby reaffirming our broad construction of the statutory language.2

 

Later, the word “place” became a further source of legal dispute. In National Organization of Women v. Little League Baseball, Inc., 67 N.J. 320, 338 A.2d 198 (1974), we affirmed the decision of the Appellate Division holding that: “[t]he statutory noun ‘place’ … is a term of convenience, not of limitation[,] … employed to reflect the fact that public accommodations are commonly provided at fixed ‘places.’” 127 N.J.Super. 522, 531, 318 A.2d 33 (App.Div.1974). The defendant in Little League was a chartered baseball league that excluded girls between the ages of eight and twelve years from participation in its programs. The league contended that it did not come “within the meaning of the statute, primarily because it [was] a membership organization which does not operate from any fixed parcel of real estate in New Jersey of which it had exclusive possession by ownership or lease.” Id. at 530, 318 A.2d 33. The court rejected that narrow view of “place”:

 

 

The “place” of public accommodation in the case of Little League is obviously the ball field at which tryouts are arranged, instructions given, practices held and games played. The statutory “accommodations, advantages, facilities and privileges” at the place of public accommodation is the entire agglomeration of the arrangements which Little League and its local chartered leagues make and the facilities they provide for the playing of baseball by the children.

 

 

 

[Id. at 531, 318 A.2d 33 (citations omitted).]

 

 

In New Jersey, “place” has been more than a fixed location since 1974.

 

As Boy Scouts correctly observes, other jurisdictions interpreting their antidiscrimination laws have found “place” to be a limiting factor encompassing only a fixed location. See, e. g., Welsh v. Boy Scouts of Am., 993 F.2d 1267, 1269 (7th Cir.) (holding that Boy Scouts is not “place of public accommodation” under Title II of Civil Rights Act of 1964 because “Congress when enacting § 2000a(b) never intended to include membership organizations that do not maintain a close connection to a structural facility within the meaning of ‘place of public accommodation’“), cert. denied, 510 U.S. 1012, 114 S.Ct. 602, 126 L.Ed.2d 567 (1993); United States Jaycees v. Richardet, 666 P.2d 1008, 1011 (Alaska 1983) (stating that “the word ‘place’….would not encompass a service organization lacking a fixed geographical situs”); United States Jaycees v. Bloomfield, 434 A.2d 1379, 1381 (D.C.1981) (disagreeing with lower court’s conclusion that “it is not necessary that there be a building … in order to categorize an existing entity as a place of public accommodation”); United States Jaycees v. Iowa Civil Rights Comm’n, 427 N.W.2d 450, 454 (Iowa 1988) (stating that “United States Jaycees is not a ‘place’ within our definition of ‘public accommodation’“); United States Jaycees v. Massachusetts Comm’n Against Discrimination, 391 Mass.594, 463 N.E.2d 1151, 1156 (1984) (finding that Massachusetts antidiscrimination law “does not apply to [a] membership organization, since such an organization does not fall within the commonly accepted definition of ‘place’“).

 

We observe that not all jurisdictions have interpreted “place” so narrowly. The New York Court of Appeals has held that a “place of public accommodation need not be a fixed location, it is the place where petitioners do what they do,” including “the place where petitioners’ meetings and activities occur.” United States Power Squadrons v. State Human Rights Appeal Bd., 59 N.Y.2d 401, 465 N.Y.S.2d 871, 452 N.E.2d 1199, 1204 (1983). The Supreme Court of Minnesota has also approved a flexible construction of the term “place.” In United States Jaycees v. McClure, 305 N.W.2d 764, 773 (Minn.1981), the Minnesota court agreed with the Little League premise that a “‘place of public accommodation’… is less a matter of whether the organization operates on a permanent site, and more a matter of whether the organization engages in activities in places to which an unselected public is given an open invitation.”

 

Despite numerous additions and modifications to the LAD in the twentyfour years since Little League was decided, the New Jersey Legislature has not enacted a limiting definition of place. See Massachusetts Mutual Life Ins. Co. v. Manzo, 122 N.J. 104, 116, 584 A.2d 190 (1991) (stating that “[t]he Legislature’s failure to modify a judicial determination, while not dispositive, is some evidence of legislative support for the judicial construction of a statute …. [especially when] the Legislature has amended [the] statute several times without altering the judicial construction”). We decline now to construe “place” so as to include only membership associations that are connected to a particular geographic location or facility. As the Appellate Division has so aptly pointed out, “[t]o have the LAD’s reach turn on the definition of ‘place’ is irrational because ‘places do not discriminate; people who own and operate places do.’” Dale, supra, 308 N.J.Super. at 533, 706 A.2d 270 (quoting Welsh, supra, 993 F.2d at 1282 (Cummings, J., dissenting)). A membership association, like Boy Scouts, may be a “place” of public accommodation even if the accommodation is provided at “a moving situs.” Little League, supra, 127 N.J.Super. at 531, 318 A.2d 33. In this case it is readily apparent that the various locations where Boy Scout troops meet fulfill the LAD “place” requirement.

 

 

 

 

b. Public Accommodation

 

 

 

 

Our case law identifies various factors that are helpful in determining whether Boy Scouts is a “public accommodation.” We ask, generally, whether the entity before us engages in broad public solicitation, whether it maintains close relationships with the government or other public accommodations, or whether it is similar to enumerated or other previously recognized public accommodations.

 

Broad public solicitation has consistently been a principal characteristic of public accommodations. Our courts have repeatedly held that when an entity invites the public to join, attend, or participate in some way, that entity is a public accommodation within the meaning of the LAD. See, e.g., Clover Hill Swimming Club, Inc. v. Goldsboro, 47 N.J. 25, 33, 219 A.2d 161 (1966) (stating that “[a]n establishment which by advertising or otherwise extends an invitation to the public generally is a place of public accommodation”); Sellers v. Philip’s Barber Shop, 46 N.J. 340, 345, 217 A.2d 121 (1966) (stating that “[a]n establishment which caters to the public or by advertising or other forms of invitation induces patronage generally is a place of public accommodation”); Fraser, supra, 44 N.J. at 488, 210 A.2d 208 (stating that “[i]n light of the nature of the facilities and activities offered to the general public by respondent’s day camp, we hold that it is a public accommodation”); Little League, supra, 127 N.J.Super. at 531, 318 A.2d 33 (stating that “Little League is a public accommodation because the invitation is open to children in the community at large”); Evans v. Ross, 57 N.J.Super. 223, 231, 154 A.2d 441 (App.Div.) (stating that LAD requires “an establishment which caters to the public, and by advertising or other forms of invitation induces patronage generally, [not to] refuse to deal with members of the public who have accepted the invitation”), certif. denied, 31 N.J. 292, 157 A.2d 362 (1959); see also Kiwanis Int’l v. Ridgewood Kiwanis Club, 806 F.2d 468, 475 (3d Cir.1986) (stating that LAD applies whenever “the organization or club … invite[s] an unrestricted and unselected public to join as members”); Brounstein v. American Cat Fanciers Ass’n, 839 F.Supp. 1100, 1107 (D.N.J. 1993) (stating that “‘primary [public accommodation] consideration’” under LAD is “‘whether the invitation to gather is open to the public at large’“) (quoting Kiwanis Int’l, supra, 806 F.2d at 474).

 

BSA engages in broad public solicitation through various media. In 1989, for example, BSA spent more than $1 million on a national television advertising campaign. A New York Times article describes one of Boy Scouts‘“hip” television ads, quoting a BSA spokesman as stating, “scouting [is] a product and we’ve got to get the product into the hands of as many consumers as we can.”3 Kim Foltz, TV Ad’s Hip Pitch: It’s ‘Cool’ to be a Boy Scout, N.Y. Times, Oct. 30, 1989. BSA has also advertised in widely distributed magazines, such as Sports Afield and Redbook. Local Boy Scout councils engage in substantial public solicitation. BSA frequently supplies the councils with recruiting materials, such as television and radio public service announcements, advertisements, and other promotional products. Monmouth Council, in particular, has expressly invited the public by conducting recruiting drives and by providing local troops with BSA-produced posters and promotions aimed at attracting new members.

 

Boy Scout troops also take part in perhaps the most powerful invitation of all, albeit an implied one: the symbolic invitation extended by a Boy Scout each time he wears his uniform in public. See Sellers, supra, 46 N.J. at 345, 217 A.2d 121 (finding that barber shop’s pole extended implied invitation to public). A boy in a uniform may well be Boy Scouts’ strongest recruiting tool. By encouraging scouts to wear their uniforms to school, and when participating in “School Nights” and public demonstrations, Boy Scouts invites the curiosity and awareness of others in the community. Boy Scouts admits that it encourages these displays in the hope of attracting new members.

 

On the facts before us, it cannot be controverted that Boy Scouts reaches out to the public in a myriad of ways designed to increase and sustain a broad membership base. Whether by advertising or active recruitment, or through the symbolism of a Boy Scout uniform, the intent is to send the invitation to as many members of the general public as possible. Once Boy Scouts has extended this invitation, the LAD requires that all members of the public must “have equal rights … and not be subjected to the embarrassment and humiliation of being invited[,] … only to find [the] doors barred to them.” Evans, supra, 57 N.J.Super. at 231, 154 A.2d 441.

 

Boy Scouts is a “public accommodation,” not simply because of its solicitation activities, but also because it maintains close relationships with federal and state governmental bodies and with other recognized public accommodations. Our cases have held that certain organizations that benefit from relationships with the government and other public accommodations are themselves places of public accommodation within the meaning of the LAD. In Little League, for example, the court concluded that Little League was “public in the added sense that local governmental bodies characteristically make the playing areas available to the local leagues, ordinarily without charge.” 127 N.J.Super. at 531, 318 A.2d 33, aff’d, 67 N.J. 320, 338 A.2d 198 (1974). More recently, in Frank v. Ivy Club, 120 N.J. 73, 79, 110, 576 A.2d 241 (1990), a female student sought membership in the all-male eating clubs at Princeton University. Although they did not publicly solicit new members, we held that the clubs’ close relationship to the University, a place of public accommodation, rendered them subject to the LAD. Id. at 110, 576 A.2d 241.

 

It is clear that Boy Scouts benefits from a close relationship with the federal government. Indeed, BSA was chartered by Congress in 1916, 36 U.S.C.A. § 30901, and has been the recipient of equipment, supplies, and services from the federal government, also by act of Congress, 10 U.S.C.A. § 2544. Thus, the Secretary of Defense, 10U.S.C.A. § 2544(a), and other departments of the federal government, 10 U.S.C.A. § 2544(h), have been authorized to

 

 

lend to the Boy Scouts of America, for the use and accommodation of Scouts, Scouters, and officials who attend any national or world Boy Scout Jamboree, such cots, blankets, commissary equipment, flags, refrigerators, and other equipment and without reimbursement, furnish services and expendable medical supplies, as may be necessary or useful to the extent that items are in stock and items or services are available.

 

 

[10 U.S.C.A. § 2544(a).]

 

Since its inception, BSA has maintained a special association with each successive President of the United States. According to a BSA public relations fact sheet:

 

 

One of the causes contributing to the success of the Boy Scouts of America has been the thoughtful, wholehearted way in which each President of the United States since William Howard Taft in 1910 has taken an active part in the work of the movement. Each served as Honorary President during his term in office.

 

 

Another fact sheet states that seventy-eight percent of the members of the 100th Congress participated in scouting.

 

Boy Scouts also maintains a close relationship with the military. According to a BSA pamphlet entitled Organizations That Use Scouting, “military personnel serve Scouting in many capacities.” “At many [Army, Navy, Air Force, and National Coast Guard] installations, facilities are available for Scouting shows, meetings, training activities,” and other “similar Scouting events.” Monmouth Council, in particular, has used the New Jersey military installation known as Fort Monmouth.

 

Likewise, state and local governments have contributed to Boy Scouts’ success.4 In New Jersey, the Legislature has authorized the Division of Fish, Game and Wildlife in the Department of Environmental Protection to “stock with fish any body of water in this state that is under the control of and for the use of … Boy Scouts,” N.J.S.A. 23:2-3, and has exempted Boy Scouts from having to pay motor vehicle registration fees, N.J.S.A. 39:3-27. Local governmental agencies, such as fire departments and law enforcement agencies, serve Boy Scouts by sponsoring scouting units. Nationally, over 50,000 youth members belong to units sponsored by fire departments, whereas in New Jersey alone over 130 units are sponsored by fire departments and over 100 units are sponsored by law enforcement agencies.

 

Perhaps Boy Scouts’ connection to public schools and school-affiliated groups constitutes its single most beneficial governmental relationship. Organizations That Use Scouting advises that “the education field holds our greatest potential.” Boy Scouts currently recruits many of its members through its presence in and use of school facilities. A large percentage of scouting units nationally, as well as in New Jersey, are chartered by public schools and affiliated organizations.

 

Moreover, public schools and community colleges often host scouting meetings, activities, and recruiting events such as “School Nights.” “School Night for Scouting [is a] recruiting plan operated by many councils in connection with the schools.” Under this plan, an open scout meeting is held at a school in order to encourage students to join scouting. Public schools not only aid Boy Scouts by allowing the organization to use their facilities after school, but also during the school day. According to Boy Scouts, “[m]ore and more of our schools are becoming available for other than formal education…. Inschool Scouting, where the pack, troop, team, or post meets during the school day, is recognized in many areas.” In 1992, close to 700,000 students throughout the nation were taught the Boy Scouts’ Learning for Life curriculum during the school day.

 

Given Boy Scouts’ public solicitation activities, and considering its close relationship with governmental entities, it is not surprising that Boy Scouts resembles many of the recognized and enumerated places of public accommodation. Similarity to the places of public accommodation listed in the LAD has been a benchmark for determining whether the unlisted entity should be included. Cf. Board of Chosen Freeholders v. New Jersey, 159 N.J. 565, 576, 732 A.2d 1053 (1999) (stating that “[u]nder the ejusdem generis principle of statutory construction, when specific words follow more general words in a statutory enumeration, we can consider what additional items might also be included by asking whether those items are similar to those enumerated”). In Fraser v. Robin Dee Day Camp, for example, this Court held that a “day camp is the type of accommodation which the Legislature intended to reach” because a “day camp offers accommodations which have many attributes in common with swimming pools, recreation and amusement parks, motion picture houses, theatres, music halls, gymnasiums, kindergarten and primary schools, all of which are specifically enumerated” in the LAD. 44 N.J. at 487, 210 A.2d 208. The Appellate Division in Little League identified Little League’s “‘educational or recreational nature’” as a basis for the court’s conclusion that Little League was similar to the types of public accommodations listed in the statute. 127 N.J.Super. at 531, 318 A.2d 33 (quoting Fraser, supra, 44 N.J. at 487, 210 A.2d 208). Similarly, Boy Scouts’ educational and recreational nature, like the day camp in Fraser or the baseball teams in Little League, further supports our conclusion that Boy Scouts is a “place of public accommodation” under the LAD. See, e.g., Advancement Guidelines 4 (1992 ed.) (stating that “[e]ducation and fun are functions of the scouting movement”).

 

 

 

 

2.LAD Exceptions

 

 

 

 

Boy Scouts claims that even if it is a place of public accommodation, it is nonetheless exempt from the LAD under three express exceptions: (1) the “distinctly private” exception; (2) the religious educational facility exception; and (3) the in loco parentis exception. N.J.S.A. 10:5-5l. Because we determine that these exceptions do not apply to Boy Scouts, we hold that Boy Scouts is subject to the LAD.

 

“While this Court has been scrupulous in its insistence that the [LAD] be applied to the full extent of its facial coverage, it has never found such coverage to exist in the face of an unambiguous exclusion.” Peper v. Princeton Univ. Bd. of Trustees, 77 N.J. 55, 68, 389 A.2d 465 (1978) (citations omitted). Nonetheless, despite our adherence to statutory exceptions expressly and unambiguously set forth by the Legislature, we are mindful that “[e]xemptions from remedial statutes should generally be narrowly construed.”Poff v. Caro, 228 N.J.Super. 370, 379, 549 A.2d 900 (Law Div.1987) (citing Service Armament Co. v. Hyland, 70 N.J. 550, 559, 362 A.2d 13 (1976)).

 

We begin with the “distinctly private” exception. The LAD provides that “[n]othing herein contained shall be construed to include or to apply to any institution, bona fide club, or place of accommodation, which is in its nature distinctly private.” N.J.S.A. 10:5-5l. Boy Scouts’ status as a bona fide club has not been questioned. Our focus is, therefore, on the meaning of “distinctly private.” We agree with the New York Court of Appeals that this language, found in both the New York Human Rights Law, N.Y. Exec. Law § 292, and in the LAD, is intended as a narrowly drawn statutory exclusion. Power Squadrons, supra, 465 N.Y.S.2d 871, 452 N.E.2d at 1204 (stating that this exception “does not refer simply to private clubs or establishments closed to the public but uses more restrictive language excluding from the statute’s provisions only clubs which are ‘distinctly private’“). Boy Scouts bears the burden of proving that it fits within this narrow exception. Cf. Spragg v. Shore Care & Shore Mem’l Hosp., 293 N.J.Super. 33, 51, 679 A.2d 685 (App.Div.1996) (holding burden of proof on defendant-employer to prove bona fide occupational qualification exception to LAD).

 

In deciding whether Boy Scouts is a place of public accommodation, we considered the organization’s public solicitation activities. Solicitation of a broad membership base is closely related to the issue of selectivity in membership, which may explain why various courts have considered both factors in their analyses of both “place of public accommodation” and the “distinctly private” exception. See, e.g., Kiwanis, supra, 806 F.2d at 476 (stating that “distinctly private” exception “represents the other side of the ‘public accommodation’ coin …. because of the emphasis placed on ‘selectivity’ as the standard for determining ‘public accommodation,’ as well as for determining if a club is ‘distinctly private’“). We have reviewed the multiple ways in which Boy Scouts reaches out to the public and, therefore, will consider the selectivity issue as the principal determinant of “distinctly private” status. See Power Squadrons, supra, 465 N.Y.S.2d 871, 452 N.E.2d at 1204 (stating that “the essence of a private club is selectivity in its membership”).

 

Thirty-three years ago, in Clover Hill Swimming Club, Inc. v. Goldsboro, we said that “not every establishment using the ‘club’ label can be considered ‘distinctly private.’ Self-serving declarations by … an accommodation are not determinative of its character.” 47 N.J. at 34, 219 A.2d 161. Although the swimming club had represented to the public that “all applications [for membership] would be subject to approval by club officials,” it appeared that Clover Hill was only selective when black families applied. Ibid. The Court refused to accept bogus representations concerning the “private” nature of the club when it was quite clear that membership was generally open and had to do with a family’s interest in recreation and not much else. Ibid. Little League, citing Clover Hill, primarily relied on the baseball league’s “open [invitation] to children in the community at large, with no restriction (other than sex) whatever” as a basis for the court’s finding that the league was a “public accommodation.” 127 N.J.Super. at 531, 318 A.2d 33. The lack of any membership selectivity–except for the prohibition against the admission of girls– weighed in the public accommodation calculus; it also bears upon the “distinctly private” exception.

 

Kiwanis International v. Ridgewood Kiwanis Club is the only case to hold a club exempt under the “distinctly private” exception. 806 F.2d at 477. The Third Circuit, relying on Little League, applied a selectivity analysis to determine whether Kiwanis Ridgewood was a public accommodation and, therefore, not “distinctly private.” Id. at 476-77. The court found that the local club was selective based on its membership practices, which were described as follows:

 

 

The Ridgewood club is small, comprised of only twenty-eight members. Ten individuals have been members for over twenty years. Indeed, Kiwanis Ridgewood has admitted no more than twenty members over the course of the past decade. Each new member had to be sponsored by a current member, and formally voted in by the Ridgewood Board of Directors. The sponsorship of the existing member acted as a primary screening mechanism in the maintenance of the quality of membership. In addition to national membership requirements, Kiwanis Ridgewood established several local membership requirements, which included, among others, the candidate’s willingness to pray at meetings and to recite the pledge of allegiance.

 

 

 

Although Kiwanis International has encouraged large-scale membership solicitation in the past, the suggested “membership roundup” mailings were sent only to those prospects already known by current members. These individuals would be invited to a Kiwanis meeting to determine their compatibility with the organization’s goals and members. The scope of these membership drives was limited. Not only did every solicited individual have to be known by an existing member, but every applicant out of that group of solicited individuals would have to be sponsored by an existing member.

 

 

[Id. at 475.]

 

Unlike Kiwanis Ridgewood, which used “sponsorship [by an] existing member … as a primary screening mechanism in the maintenance of … quality membership,” Boy Scouts does not require new members “to be sponsored by a current member.” Ibid. Nor does Boy Scouts limit its recruiting, or invitations to the public, to individuals who are “known by an existing member.” To the contrary, Boy Scout publications indicate that the organization seeks a broad membership base. In a booklet, entitled A Representative Membership,5 Boy Scouts states that its “national objective, as well as for regions, areas, councils, and districts is to see that all eligible youth have the opportunity to affiliate with the Boy Scouts of America.” Id. at 1 (emphasis added). The booklet is emphatically inclusive:

 

 

We have high hopes for our nation’s future. These hopes cannot flower if any part of our citizenry feels deprived of the opportunity to help shape the future. How can you persuade other Scouters to accept a commitment to a representative membership? Consider these facts:

 

 

 

1. Our federal charter sets forth our obligation to serve boys. Neither the charter nor the bylaws of the Boy Scouts of America permits the exclusion of any boy. The National Council and Executive Board have always taken the position that Scouting should be available for all boys who meet the entrance age requirements.

 

 

….

 

 

4. Another aim of Scouting is the development of leadership. Leadership in America is needed in all sections of the country and in all economic, cultural, and ethnic groups.

 

 

 

5. To meet these responsibilities we have made a commitment that our membership shall be representative of all the population in every community, district, and council.

 

 

[Id. at 2 (emphasis added).]

 

Boy Scouts’ large membership further undercuts its claim to selective membership. Nationally, over four million boys and one million adults were Boy Scout members in 1992.6 Since its inception, over 87 million people have joined Boy Scouts. In 1991, Monmouth Council alone had over 8400 youths and over 2700 adult members. The New York Court of Appeals, construing “distinctly private” in United States Power Squadrons v. State Human Rights Appeal Board, has suggested that an organization’s failure to limit its maximum membership, in and of itself, demonstrates that the club is not private: “Organizations which routinely accept applicants and place no subjective limits on the number of persons eligible for membership are not private clubs.” 465 N.Y.S.2d 871, 452 N.E.2d at 1204. We note only that the size of the Boy Scout organization certainly implies an open membership policy.

 

Boy Scouts argues, however, that it is “distinctly private” because its Scout Oath and Scout Law constitute genuine selectivity criteria. In support of its position, Boy Scouts relies on Welsh v. Boy Scouts of_ America, wherein the Seventh Circuit stated:

 

 

Although the Scouts intentionally admit a large number of boys from diverse backgrounds, admission to membership is not without exercise of sound discretion and judgment. This is evident from the Constitution and By-laws as well as the Boy Scouts’ Oath and Scout Law.

 

 

 

… We hold therefore that the Scouts organization not only is selective, but that its very Constitution, By-laws and doctrine dictate that it remain selective.

 

 

[993 F.2d at 1276-77.]

 

We acknowledge that Boy Scouts’ membership application requires members to comply with the Scout Oath and Law. We do not find, however, that the Oath and Law operate as genuine selectivity criteria. To the contrary, the record discloses few instances in which the Oath and Law have been used to exclude a prospective member; in practice, they present no real impediment to joining Boy Scouts. Joining requirements are insufficient to establish selectivity where they do not function as true limits on the admission of members. See Power Squadrons, supra, 465 N.Y.S.2d 871, 452 N.E.2d at 1204 (requiring examination for basic boating course was not “selective” where club “place[d] no subjective limits on the number of persons eligible for membership”). Here, there is no evidence that Boy Scouts does anything but accept at face value a scout’s affirmation of the Oath and Law. See Roberts v. United States Jaycees, 468 U.S. 609, 621, 104 S.Ct. 3244, 3251, 82 L.Ed.2d 462, 473 (1984) (finding group unselective where “new members are routinely recruited and admitted with no inquiry into their backgrounds”).

 

Most important, it is clear that Boy Scouts does not limit its membership to individuals who belong to a particular religion or subscribe to a specific set of moral beliefs. Boy Scouts asserts that “[t]here is a close association between the Boy Scouts of America and virtually all religious bodies and denominations in the United States,” and that each member’s concept of “moral fitness” should be determined by his “courage to do what his head and heart tell him is right.” See supra at 575-76, 734 A.2d at 1203. Moreover, Boy Scouts encourages its members to “respect and defend the rights of others whose beliefs may differ.” Scoutmaster Handbook, supra, at 561. By its own teachings then, Boy Scouts is inclusive, not selective, in its membership practices.

 

Boy Scouts also argues that it is “distinctly private” because it is selective in its adult membership. In addition to the Scout Oath and Law requirements, adult members are bound by the Declaration of Religious Principle, and are subject to evaluation according to informal criteria designed to select only individuals capable of accepting responsibility for the moral education and care of other people’s children in accordance with scouting values. Several of the Troop 73 leaders who were involved in Dale’s adult membership approval have said that they would not have approved Dale’s application had they known that Dale was an “avowed” homosexual, thus lending support to BSA’s position.

 

The Appellate Division’s analysis of Boy Scouts’ adult membership selectivity dispels the notion that an open membership organization can claim the “distinctly private” exception because it is selective as to a small subset of the larger group:

 

 

We reject the suggestion that the BSA organization as a whole is not a place of public accommodation because more stringent membership criteria are applied to a single component of the organization, its adult members. Such a result is clearly inconsistent with the remedial purposes of the LAD. Acceptance of the argument would mean that public clubs in Clover Hill and Fraser, are not places of public accommodation because their member-counselors or lifeguards are subject to more stringent, enhanced training criteria. An extension of defendants’ argument would be that the BSA is not a place of public accommodation because of the demanding standards that must be met to become an Eagle Scout.

 

 

[Dale, supra, 308 N.J.Super. at 538, 706 A.2d 270 (citations omitted).]

 

See also Brounstein, supra, 839 F.Supp. at 1107-08 (stating that “[t]he fact that an organization is selective with respect to the privileges and benefits it accords to members does not exempt that organization from the proscriptions of the LAD if it is otherwise a ‘public place of accommodation’“).

 

Boy Scouts accepts boys who come from diverse cultures and who belong to different religions. It teaches tolerance and understanding of differences in others. It presents itself to its members and to the public generally as a nonsectarian organization “available to all boys who meet the entrance age requirements.” Its Charter and its Bylaws do not permit the exclusion of any boy. Boy Scouts is not “distinctly private” because it is not selective in its membership.

 

Boy Scouts claims, however, that it is exempt from the LAD because it is an “educational facility operated or maintained by a bona fide religious or sectarian institution.” N.J.S.A. 10:5-5l. This claim deserves little discussion. Boy Scouts repeatedly states that it is nonsectarian. Its Bylaws declare that no member shall be required “to take part in or observe a religious ceremony distinctly unique” to a church or other religious organization. Boy Scouts emphasizes that religious instruction is better reserved for “the home and the organization or group with which the member is connected.” Further, the Scoutmaster Handbook instructs its leaders that scouting “is identified with no particular faith, encourages no particular affiliation, nor assumes functions of religious bodies.” We cannot say that Boy Scouts is a “bona fide religious or sectarian institution” in the face of the organization’s clear pronouncements on this subject.7

 

… .

 

We hold that Boy Scouts is a “place of public accommodation” and is not exempt from the LAD under any of the statute’s exceptions.

 

[The court went on to hold that the Boy Scouts’ discriminatory membership policy was not protected by the First Amendement. This holding, and thus the outcome of this case, was reversed by the Supreme Court of the United States in Boy Scouts of America v. Dale, 530 U.S. 640 (2000).]

 


    1. Dale subsequently learned that in 1978 BSA had prepared a position paper stating that “an individual who openly declares himself to be a homosexual [may not] be a volunteer scout leader [or] … a registered unit member[.]” The position paper “was never distributed. Statements were also written in 1991 and 1993 expressing similar positions. These statements were written after the onset of litigation in other states charging the organization with discrimination against members on the basis of sexual orientation.

 

    1. N.J.S.A. 10:5-5l now reads:

       

      “A place of public accommodation” shall include, but not be limited to: any tavern, roadhouse, hotel, motel, trailer camp, summer camp, day camp, or resort camp, whether for entertainment of transient guests or accommodation of those seeking health, recreation or rest; any producer, manufacturer, wholesaler, distributor, retail shop, store, establishment, or concession dealing with goods or services of any kind; any restaurant, eating house, or place where food is sold for consumption on the premises; any place maintained for the sale of ice cream, ice and fruit preparations or their derivatives, soda water or confections, or where any beverages of any kind are retailed for consumption on the premises; any garage, any public conveyance operated on land or water, or in the air, any stations and terminals thereof; any bathhouse, boardwalk, or seashore accommodation; any auditorium, meeting place, or hall; any theatre, motion-picture house, music hall, roof garden, skating rink, swimming pool, amusement and recreation park, fair, bowling alley, gymnasium, shooting gallery, billiard and pool parlor, or other place of amusement; any comfort station; any dispensary, clinic or hospital; any public library; any kindergarten, primary and secondary school, trade or business school, high school, academy, college and university, or any educational institution under the supervision of the State Board of Education, or the Commissioner of Education of the State of New Jersey. Nothing herein contained shall be construed to include or to apply to any institution, bona fide club, or place of accommodation, which is in its nature distinctly private; nor shall anything herein contained apply to any educational facility operated or maintained by a bona fide religious or sectarian institution, and the right of a natural parent or one in loco parentis to direct the education and upbringing of a child under his control is hereby affirmed; nor shall anything herein contained be construed to bar any private secondary or post secondary school from using in good faith criteria other than race, creed, color, national origin, ancestry or affectional or sexual orientation in the admission of students.

 

    1. Boy Scouts expresses concern that this article is not properly part of the record before us. Although the quoted statement has not been authenticated, we find it descriptive of material in the record respecting BSA’s public solicitation and membership recruitment efforts.

 

    1. New Jersey governmental entities are, of course, bound by the LAD. Their sponsorship of, or conferring of special benefits on, an organization that practices discrimination would be prohibited.

 

    1. Boy Scouts also questions whether this booklet is properly before us. See supra at 590 n. 6, 734 A.2d at 1211 n. 6). The booklet on its face states that it is a BSA publication prepared for national, council, district, and local board/committee members, and Boy Scouts has not indicated otherwise.

 

    1. Boy Scouts argues that this Court should follow Kiwanis, supra, 806 F.2d at 476 n. 14, and limit review of Boy Scouts’ membership selection practices to the local, rather than the national level. We decline to follow Kiwanis in this case. Boy Scouts’ local units, unlike Kiwanis Ridgewood, are not authorized to establish additional “local membership requirements,” id. at 475, nor are they empowered generally to change BSA’s policies. We find that the various levels of scouting are interrelated such that a review of the national organization’s membership selection practices–as opposed to the local unit–is most appropriate.

 

    1. That Boy Scouts’ oath expresses a belief in God does not make it a religious institution. Nor does Boy Scouts’ commitment to “[e]ducation and fun,” see supra at 594, 734 A.2d at 1213 (emphasis added), qualify it as an “educational facility” under N.J.S.A. 10:5-5l.

 

 

 

7.3.2. Civil Rights Acts

 

Dale v. Boy Scouts of America,

160 N.J. 562 (1999)

 

 

 

George A. Davidson, a member of the New York bar, New York City, for defendants-appellants and cross-respondents (Cerrato, Dawes, Collins, Saker & Brown, attorneys, Freehold; Mr. Davidson, Sanford D. Brown, Freehold and Carla A. Kerr, a member of the New York bar, New York City, on the briefs).

 

Evan Wolfson, a member of the New York bar, New York City, for plaintiff-respondent and cross-appellant (Lewis H. Robertson, attorney, Red Bank; Mr. Wolfson, Mr. Robertson and Thomas J. Moloney, a member of the New York bar, New York City, on the briefs).

 

 

 

The opinion of the Court was delivered by Poritz C.J.

 

 

 

In 1991, the New Jersey Legislature amended the Law Against Discrimination (LAD), N.J.S.A. 10:5-1 to -49, to include protections based on “affectional or sexual orientation.” This case requires us to decide whether that law prohibits Boy Scouts of America (BSA) from expelling a member solely because he is an avowed homosexual.

 

Defendants BSA and Monmouth Council (collectively Boy Scouts) seek review of a decision of the Appellate Division holding that: (1) Boy Scouts is a place of public accommodation as defined by the LAD; (2) Boy Scouts’ expulsion of plaintiff James Dale, an assistant scoutmaster, based solely on the club’s policy of excluding avowed homosexuals from membership is prohibited by the LAD; and (3) the LAD prohibition does not violate Boy Scouts’ First Amendment rights. Plaintiff, James Dale, seeks certification on his common law claim, dismissed by the Appellate Division. We granted both parties’ petitions, 156 N.J. 381, 718 A.2d 1210, 156 N.J. 382, 718 A.2d 1210 (1998), and now affirm.

 

… .

 

James Dale first became a BSA member in 1978 when, at the age of eight, he joined Monmouth Council’s Cub Scout Pack 142. He remained a Cub Scout until 1981, when he became a member of Boy Scout Troop 220, also in Monmouth Council. He joined Monmouth Council’s Boy Scout Troop 128 in 1983, and Troop 73 in 1985. Until his eighteenth birthday in 1988, he remained a youth member of Troop 73.

 

Dale was an exemplary scout. Over the ten years of his membership, he earned more than twenty-five merit badges. In 1983, he was admitted into Boy Scouts’ Order of the Arrow, the organization’s honor camping society, and achieved the status of Virgil Honor. The pinnacle of Dale’s career as a youth member came in 1988, when BSA awarded him an Eagle Scout Badge, an honor achieved by only the top three percent of all scouts.

 

Dale’s participation in Boy Scout leadership began at an early age. Throughout his years as a member, Dale was an assistant patrol leader, patrol leader, and bugler, and from 1985 to 1988, Dale served as a Junior Assistant Scoutmaster for Troop 73. He was also invited to speak at organized Boy Scout functions, such as the Joshua Huddy Distinguished Citizenship Award Dinner, and attended national events, including the National Boy Scout Jamboree. On March 21, 1989, Dale sought adult membership in Boy Scouts. Monmouth Council and BSA accepted and approved his application for the position of Assistant Scoutmaster of Troop 73 where he served for approximately sixteen months.

 

At about the same time that Dale applied for adult membership, he left home to attend Rutgers University. While at college, Dale first acknowledged to himself, and to his family and friends, that he was gay. Shortly thereafter, he became involved with, and eventually became the co-president of the Rutgers University Lesbian/Gay Alliance. Then, in July 1990, Dale attended a seminar that addressed the psychological and health needs of lesbian and gay teenagers. The Star-Ledger interviewed Dale and published an article on July 8, 1990 that discussed the seminar. The article included Dale’s photograph and a caption identifying him as “co-president of the Rutgers University Lesbian/Gay Alliance.” Kinga Borondy, Seminar Addresses Needs of Homosexual Teens, Star-Ledger (Newark), July 8, 1990, § 2, at 11.

 

Later that month, Dale received a letter from Monmouth Council Executive James W. Kay, revoking his BSA membership. The letter asked Dale to “sever any relations [he] may have with the Boy Scouts of America,” and granted Dale sixty days to request a review of his termination from the Monmouth Council Regional Review Committee.

 

Dale wrote to Kay on August 8, 1990, and requested the basis for the Monmouth Council’s decision. In a letter dated August 10, 1990, Kay notified Dale that the “grounds for [his] membership revocation” were “the standards for leadership established by the Boy Scouts of America, which specifically forbid membership to homosexuals.”1 On September 30, 1990, Dale wrote a letter to the Northeast Regional Director, Rudy Flythe, asking for a review of his membership decision and a copy of BSA’s leadership standards. Dale also requested permission to attend the review, a right to which he was entitled under the Monmouth Council Review Procedures. The Regional Review Committee acknowledged receipt of Dale’s request, but neglected to provide him with a copy of the BSA standards for leadership or a review date.

 

In another letter dated October 16, 1990, Dale once again asked for a copy of the leadership standards and notice of the review date. On November 27, 1990, Charles Ball, the Assistant Regional Director of the Northeast Region, notified Dale that the “Northeast Region, [BSA] Review Committee supports the decision of the Monmouth Council … to deny your registration with [BSA],” and granted Dale thirty days to seek review by the National Council Review Committee. Three weeks later, through counsel, Dale wrote to the Chief Scout Executive of BSA and requested a rehearing and an opportunity to attend the review. BSA’s counsel informed Dale on December 21, 1990, that he had been denied the right to attend because: “[BSA] does not admit avowed homosexuals to membership in the organization so no useful purpose would apparently be served by having Mr. Dale present at the regional review meeting.” BSA did agree, however, to have the National Council review Dale’s membership revocation. Because Dale believed that a National Council review “would be futile,” he initiated these legal proceedings.

 

… .

 

On July 29, 1992, Dale filed a six-count complaint against BSA and Monmouth Council in the Superior Court of New Jersey. Dale alleged that Boy Scouts had violated the New Jersey Law Against Discrimination and common law by revoking his membership based solely on his sexual orientation. He sought declaratory, injunctive, compensatory and punitive monetary relief, as well as costs and attorney fees.

 

… .

 

Dale moved for partial summary judgment in September 1993, demanding immediate reinstatement based on his claim that defendants had violated the LAD and New Jersey’s public policy. Defendants, in response, cross-moved for summary judgment on all counts. The court denied Dale’s motion and granted Boy Scouts’ cross-motion. Dale v. Boy Scouts of Am., No. MON-C-330-92 (Ch. Div. Nov. 3, 1995). After concluding that Dale was “a sexually active homosexual,” the court found that Boy Scouts had always had a policy of excluding “active homosexual[s].” Id. at 6, 38. The court opined that homosexual acts are immoral and attributed to Boy Scouts a longstanding antipathy toward such behavior. Id. at 39-40. In the judge’s view, “[i]t [was] unthinkable … that the BSA could or would tolerate active homosexuality if discovered in any of its members.” Id. at 40.

 

As to the applicability of the LAD, the court held that Boy Scouts was not a place of public accommodation, or alternatively, that Boy Scouts was exempt under the “distinctly private” exception found at N.J.S.A. 10:5-5l. Id. at 55. The court rejected Dale’s common law claim, finding that the State’s policy “is that established by the NJLAD … [and] not some prior common law policy.” Id. at 45. Because the court believed that Boy Scouts’ moral position in respect of active homosexuality was clear, it found that Boy Scouts’ First Amendment freedom of expressive association “prevent[ed] government from forcing [the organization] to accept Dale as an adult leader-member.” Id. at 71.

 

The Appellate Division affirmed the dismissal of Dale’s common law claim, but otherwise reversed and remanded for further proceedings. Dale v. Boy Scouts of Am., 308 N.J.Super. 516, 523, 706 A.2d 270 (App.Div.1998).

 

… .

 

A.The LAD

 

We first consider whether Boy Scouts is subject to the LAD, which provides that “[a]ll persons shall have the opportunity… to obtain all the accommodations, advantages, facilities, and privileges of any place of public accommodation, … without discrimination because of … affectional or sexual orientation.” N.J.S.A. 10:5-4. Boy Scouts must therefore abide by the LAD if Boy Scouts is a place of public accommodation and does not meet any of the LAD exceptions. See, e.g., N.J.S.A. 10:5-5l (exempting “distinctly private” entities, religious educational facilities, and parents or individuals acting “in loco parentis” in respect of “the education and upbringing of a child”).

 

 

 

 

1.Place of Public Accommodation

 

 

 

 

“[T]he overarching goal of the [LAD] is nothing less than the eradication ‘of the cancer of discrimination.’” Fuchilla v. Layman, 109 N.J. 319, 334, 537 A.2d 652 (quoting Jackson v. Concord Co., 54 N.J. 113, 124, 253 A.2d 793 (1969)), cert. denied, 488 U.S. 826, 109 S.Ct. 75, 102 L. Ed.2d 51 (1988). “[D]iscrimination threatens not only the rights and proper privileges of the inhabitants of [New Jersey,] but menaces the institutions and foundation of a free democratic State.” N.J.S.A. 10:5-3. In furtherance of its purpose to root out discrimination, the Legislature has directed that the LAD “shall be liberally construed.” Ibid. We have adhered to that legislative mandate by historically and consistently interpreting the LAD “‘with that high degree of liberality which comports with the preeminent social significance of its purposes and objects.’” Andersen v. Exxon Co., 89 N.J. 483, 495, 446 A.2d 486 (1982) (quoting Passaic Daily News v. Blair, 63 N.J. 474, 484, 308 A.2d 649 (1973)).

 

A clear understanding of the phrase “place of public accommodation” is critical. That is because “place of public accommodation” is, in large measure, determinative of the LAD’s scope. Certainly, if the statute is broadly applicable, the antidiscriminatory impact of its provisions is greater. The Legislature’s finding that the effects of discrimination are pernicious, and its directive to liberally construe the LAD, have informed our cases interpreting the reach of “place of public accommodation.”

 

 

 

 

a.Place

 

 

 

 

In 1965, the Court held that places of public accommodation were not limited to those enumerated in the statute. Fraser v. Robin Dee Day Camp, 44 N.J. 480, 486, 210 A.2d 208 (1965) (then N.J.S.A. 18:25-5(l)). At that time, the statutory definition used the word “include” to preface a list of specific “places” of public accommodation. See id. at 485, 210 A.2d 208. We reasoned that the Legislature’s choice of the word “include” indicated that the “places” expressly mentioned were “merely illustrative of the accommodations the Legislature intended to be within the scope of the statute. Other accommodations, similar in nature to those enumerated, were also intended to be covered.” Id. at 486, 210 A.2d 208. Less than a year later, the Legislature amended the LAD to expressly state that “‘a place of public accommodation’ shall include, but not be limited to” the various examples identified, L. 1966, c. 17 (emphasis added), thereby reaffirming our broad construction of the statutory language.2

 

Later, the word “place” became a further source of legal dispute. In National Organization of Women v. Little League Baseball, Inc., 67 N.J. 320, 338 A.2d 198 (1974), we affirmed the decision of the Appellate Division holding that: “[t]he statutory noun ‘place’ … is a term of convenience, not of limitation[,] … employed to reflect the fact that public accommodations are commonly provided at fixed ‘places.’” 127 N.J.Super. 522, 531, 318 A.2d 33 (App.Div.1974). The defendant in Little League was a chartered baseball league that excluded girls between the ages of eight and twelve years from participation in its programs. The league contended that it did not come “within the meaning of the statute, primarily because it [was] a membership organization which does not operate from any fixed parcel of real estate in New Jersey of which it had exclusive possession by ownership or lease.” Id. at 530, 318 A.2d 33. The court rejected that narrow view of “place”:

 

 

The “place” of public accommodation in the case of Little League is obviously the ball field at which tryouts are arranged, instructions given, practices held and games played. The statutory “accommodations, advantages, facilities and privileges” at the place of public accommodation is the entire agglomeration of the arrangements which Little League and its local chartered leagues make and the facilities they provide for the playing of baseball by the children.

 

 

 

[Id. at 531, 318 A.2d 33 (citations omitted).]

 

 

In New Jersey, “place” has been more than a fixed location since 1974.

 

As Boy Scouts correctly observes, other jurisdictions interpreting their antidiscrimination laws have found “place” to be a limiting factor encompassing only a fixed location. See, e. g., Welsh v. Boy Scouts of Am., 993 F.2d 1267, 1269 (7th Cir.) (holding that Boy Scouts is not “place of public accommodation” under Title II of Civil Rights Act of 1964 because “Congress when enacting § 2000a(b) never intended to include membership organizations that do not maintain a close connection to a structural facility within the meaning of ‘place of public accommodation’“), cert. denied, 510 U.S. 1012, 114 S.Ct. 602, 126 L.Ed.2d 567 (1993); United States Jaycees v. Richardet, 666 P.2d 1008, 1011 (Alaska 1983) (stating that “the word ‘place’….would not encompass a service organization lacking a fixed geographical situs”); United States Jaycees v. Bloomfield, 434 A.2d 1379, 1381 (D.C.1981) (disagreeing with lower court’s conclusion that “it is not necessary that there be a building … in order to categorize an existing entity as a place of public accommodation”); United States Jaycees v. Iowa Civil Rights Comm’n, 427 N.W.2d 450, 454 (Iowa 1988) (stating that “United States Jaycees is not a ‘place’ within our definition of ‘public accommodation’“); United States Jaycees v. Massachusetts Comm’n Against Discrimination, 391 Mass.594, 463 N.E.2d 1151, 1156 (1984) (finding that Massachusetts antidiscrimination law “does not apply to [a] membership organization, since such an organization does not fall within the commonly accepted definition of ‘place’“).

 

We observe that not all jurisdictions have interpreted “place” so narrowly. The New York Court of Appeals has held that a “place of public accommodation need not be a fixed location, it is the place where petitioners do what they do,” including “the place where petitioners’ meetings and activities occur.” United States Power Squadrons v. State Human Rights Appeal Bd., 59 N.Y.2d 401, 465 N.Y.S.2d 871, 452 N.E.2d 1199, 1204 (1983). The Supreme Court of Minnesota has also approved a flexible construction of the term “place.” In United States Jaycees v. McClure, 305 N.W.2d 764, 773 (Minn.1981), the Minnesota court agreed with the Little League premise that a “‘place of public accommodation’… is less a matter of whether the organization operates on a permanent site, and more a matter of whether the organization engages in activities in places to which an unselected public is given an open invitation.”

 

Despite numerous additions and modifications to the LAD in the twentyfour years since Little League was decided, the New Jersey Legislature has not enacted a limiting definition of place. See Massachusetts Mutual Life Ins. Co. v. Manzo, 122 N.J. 104, 116, 584 A.2d 190 (1991) (stating that “[t]he Legislature’s failure to modify a judicial determination, while not dispositive, is some evidence of legislative support for the judicial construction of a statute …. [especially when] the Legislature has amended [the] statute several times without altering the judicial construction”). We decline now to construe “place” so as to include only membership associations that are connected to a particular geographic location or facility. As the Appellate Division has so aptly pointed out, “[t]o have the LAD’s reach turn on the definition of ‘place’ is irrational because ‘places do not discriminate; people who own and operate places do.’” Dale, supra, 308 N.J.Super. at 533, 706 A.2d 270 (quoting Welsh, supra, 993 F.2d at 1282 (Cummings, J., dissenting)). A membership association, like Boy Scouts, may be a “place” of public accommodation even if the accommodation is provided at “a moving situs.” Little League, supra, 127 N.J.Super. at 531, 318 A.2d 33. In this case it is readily apparent that the various locations where Boy Scout troops meet fulfill the LAD “place” requirement.

 

 

 

 

b. Public Accommodation

 

 

 

 

Our case law identifies various factors that are helpful in determining whether Boy Scouts is a “public accommodation.” We ask, generally, whether the entity before us engages in broad public solicitation, whether it maintains close relationships with the government or other public accommodations, or whether it is similar to enumerated or other previously recognized public accommodations.

 

Broad public solicitation has consistently been a principal characteristic of public accommodations. Our courts have repeatedly held that when an entity invites the public to join, attend, or participate in some way, that entity is a public accommodation within the meaning of the LAD. See, e.g., Clover Hill Swimming Club, Inc. v. Goldsboro, 47 N.J. 25, 33, 219 A.2d 161 (1966) (stating that “[a]n establishment which by advertising or otherwise extends an invitation to the public generally is a place of public accommodation”); Sellers v. Philip’s Barber Shop, 46 N.J. 340, 345, 217 A.2d 121 (1966) (stating that “[a]n establishment which caters to the public or by advertising or other forms of invitation induces patronage generally is a place of public accommodation”); Fraser, supra, 44 N.J. at 488, 210 A.2d 208 (stating that “[i]n light of the nature of the facilities and activities offered to the general public by respondent’s day camp, we hold that it is a public accommodation”); Little League, supra, 127 N.J.Super. at 531, 318 A.2d 33 (stating that “Little League is a public accommodation because the invitation is open to children in the community at large”); Evans v. Ross, 57 N.J.Super. 223, 231, 154 A.2d 441 (App.Div.) (stating that LAD requires “an establishment which caters to the public, and by advertising or other forms of invitation induces patronage generally, [not to] refuse to deal with members of the public who have accepted the invitation”), certif. denied, 31 N.J. 292, 157 A.2d 362 (1959); see also Kiwanis Int’l v. Ridgewood Kiwanis Club, 806 F.2d 468, 475 (3d Cir.1986) (stating that LAD applies whenever “the organization or club … invite[s] an unrestricted and unselected public to join as members”); Brounstein v. American Cat Fanciers Ass’n, 839 F.Supp. 1100, 1107 (D.N.J. 1993) (stating that “‘primary [public accommodation] consideration’” under LAD is “‘whether the invitation to gather is open to the public at large’“) (quoting Kiwanis Int’l, supra, 806 F.2d at 474).

 

BSA engages in broad public solicitation through various media. In 1989, for example, BSA spent more than $1 million on a national television advertising campaign. A New York Times article describes one of Boy Scouts‘“hip” television ads, quoting a BSA spokesman as stating, “scouting [is] a product and we’ve got to get the product into the hands of as many consumers as we can.”3 Kim Foltz, TV Ad’s Hip Pitch: It’s ‘Cool’ to be a Boy Scout, N.Y. Times, Oct. 30, 1989. BSA has also advertised in widely distributed magazines, such as Sports Afield and Redbook. Local Boy Scout councils engage in substantial public solicitation. BSA frequently supplies the councils with recruiting materials, such as television and radio public service announcements, advertisements, and other promotional products. Monmouth Council, in particular, has expressly invited the public by conducting recruiting drives and by providing local troops with BSA-produced posters and promotions aimed at attracting new members.

 

Boy Scout troops also take part in perhaps the most powerful invitation of all, albeit an implied one: the symbolic invitation extended by a Boy Scout each time he wears his uniform in public. See Sellers, supra, 46 N.J. at 345, 217 A.2d 121 (finding that barber shop’s pole extended implied invitation to public). A boy in a uniform may well be Boy Scouts’ strongest recruiting tool. By encouraging scouts to wear their uniforms to school, and when participating in “School Nights” and public demonstrations, Boy Scouts invites the curiosity and awareness of others in the community. Boy Scouts admits that it encourages these displays in the hope of attracting new members.

 

On the facts before us, it cannot be controverted that Boy Scouts reaches out to the public in a myriad of ways designed to increase and sustain a broad membership base. Whether by advertising or active recruitment, or through the symbolism of a Boy Scout uniform, the intent is to send the invitation to as many members of the general public as possible. Once Boy Scouts has extended this invitation, the LAD requires that all members of the public must “have equal rights … and not be subjected to the embarrassment and humiliation of being invited[,] … only to find [the] doors barred to them.” Evans, supra, 57 N.J.Super. at 231, 154 A.2d 441.

 

Boy Scouts is a “public accommodation,” not simply because of its solicitation activities, but also because it maintains close relationships with federal and state governmental bodies and with other recognized public accommodations. Our cases have held that certain organizations that benefit from relationships with the government and other public accommodations are themselves places of public accommodation within the meaning of the LAD. In Little League, for example, the court concluded that Little League was “public in the added sense that local governmental bodies characteristically make the playing areas available to the local leagues, ordinarily without charge.” 127 N.J.Super. at 531, 318 A.2d 33, aff’d, 67 N.J. 320, 338 A.2d 198 (1974). More recently, in Frank v. Ivy Club, 120 N.J. 73, 79, 110, 576 A.2d 241 (1990), a female student sought membership in the all-male eating clubs at Princeton University. Although they did not publicly solicit new members, we held that the clubs’ close relationship to the University, a place of public accommodation, rendered them subject to the LAD. Id. at 110, 576 A.2d 241.

 

It is clear that Boy Scouts benefits from a close relationship with the federal government. Indeed, BSA was chartered by Congress in 1916, 36 U.S.C.A. § 30901, and has been the recipient of equipment, supplies, and services from the federal government, also by act of Congress, 10 U.S.C.A. § 2544. Thus, the Secretary of Defense, 10U.S.C.A. § 2544(a), and other departments of the federal government, 10 U.S.C.A. § 2544(h), have been authorized to

 

 

lend to the Boy Scouts of America, for the use and accommodation of Scouts, Scouters, and officials who attend any national or world Boy Scout Jamboree, such cots, blankets, commissary equipment, flags, refrigerators, and other equipment and without reimbursement, furnish services and expendable medical supplies, as may be necessary or useful to the extent that items are in stock and items or services are available.

 

 

[10 U.S.C.A. § 2544(a).]

 

Since its inception, BSA has maintained a special association with each successive President of the United States. According to a BSA public relations fact sheet:

 

 

One of the causes contributing to the success of the Boy Scouts of America has been the thoughtful, wholehearted way in which each President of the United States since William Howard Taft in 1910 has taken an active part in the work of the movement. Each served as Honorary President during his term in office.

 

 

Another fact sheet states that seventy-eight percent of the members of the 100th Congress participated in scouting.

 

Boy Scouts also maintains a close relationship with the military. According to a BSA pamphlet entitled Organizations That Use Scouting, “military personnel serve Scouting in many capacities.” “At many [Army, Navy, Air Force, and National Coast Guard] installations, facilities are available for Scouting shows, meetings, training activities,” and other “similar Scouting events.” Monmouth Council, in particular, has used the New Jersey military installation known as Fort Monmouth.

 

Likewise, state and local governments have contributed to Boy Scouts’ success.4 In New Jersey, the Legislature has authorized the Division of Fish, Game and Wildlife in the Department of Environmental Protection to “stock with fish any body of water in this state that is under the control of and for the use of … Boy Scouts,” N.J.S.A. 23:2-3, and has exempted Boy Scouts from having to pay motor vehicle registration fees, N.J.S.A. 39:3-27. Local governmental agencies, such as fire departments and law enforcement agencies, serve Boy Scouts by sponsoring scouting units. Nationally, over 50,000 youth members belong to units sponsored by fire departments, whereas in New Jersey alone over 130 units are sponsored by fire departments and over 100 units are sponsored by law enforcement agencies.

 

Perhaps Boy Scouts’ connection to public schools and school-affiliated groups constitutes its single most beneficial governmental relationship. Organizations That Use Scouting advises that “the education field holds our greatest potential.” Boy Scouts currently recruits many of its members through its presence in and use of school facilities. A large percentage of scouting units nationally, as well as in New Jersey, are chartered by public schools and affiliated organizations.

 

Moreover, public schools and community colleges often host scouting meetings, activities, and recruiting events such as “School Nights.” “School Night for Scouting [is a] recruiting plan operated by many councils in connection with the schools.” Under this plan, an open scout meeting is held at a school in order to encourage students to join scouting. Public schools not only aid Boy Scouts by allowing the organization to use their facilities after school, but also during the school day. According to Boy Scouts, “[m]ore and more of our schools are becoming available for other than formal education…. Inschool Scouting, where the pack, troop, team, or post meets during the school day, is recognized in many areas.” In 1992, close to 700,000 students throughout the nation were taught the Boy Scouts’ Learning for Life curriculum during the school day.

 

Given Boy Scouts’ public solicitation activities, and considering its close relationship with governmental entities, it is not surprising that Boy Scouts resembles many of the recognized and enumerated places of public accommodation. Similarity to the places of public accommodation listed in the LAD has been a benchmark for determining whether the unlisted entity should be included. Cf. Board of Chosen Freeholders v. New Jersey, 159 N.J. 565, 576, 732 A.2d 1053 (1999) (stating that “[u]nder the ejusdem generis principle of statutory construction, when specific words follow more general words in a statutory enumeration, we can consider what additional items might also be included by asking whether those items are similar to those enumerated”). In Fraser v. Robin Dee Day Camp, for example, this Court held that a “day camp is the type of accommodation which the Legislature intended to reach” because a “day camp offers accommodations which have many attributes in common with swimming pools, recreation and amusement parks, motion picture houses, theatres, music halls, gymnasiums, kindergarten and primary schools, all of which are specifically enumerated” in the LAD. 44 N.J. at 487, 210 A.2d 208. The Appellate Division in Little League identified Little League’s “‘educational or recreational nature’” as a basis for the court’s conclusion that Little League was similar to the types of public accommodations listed in the statute. 127 N.J.Super. at 531, 318 A.2d 33 (quoting Fraser, supra, 44 N.J. at 487, 210 A.2d 208). Similarly, Boy Scouts’ educational and recreational nature, like the day camp in Fraser or the baseball teams in Little League, further supports our conclusion that Boy Scouts is a “place of public accommodation” under the LAD. See, e.g., Advancement Guidelines 4 (1992 ed.) (stating that “[e]ducation and fun are functions of the scouting movement”).

 

 

 

 

2.LAD Exceptions

 

 

 

 

Boy Scouts claims that even if it is a place of public accommodation, it is nonetheless exempt from the LAD under three express exceptions: (1) the “distinctly private” exception; (2) the religious educational facility exception; and (3) the in loco parentis exception. N.J.S.A. 10:5-5l. Because we determine that these exceptions do not apply to Boy Scouts, we hold that Boy Scouts is subject to the LAD.

 

“While this Court has been scrupulous in its insistence that the [LAD] be applied to the full extent of its facial coverage, it has never found such coverage to exist in the face of an unambiguous exclusion.” Peper v. Princeton Univ. Bd. of Trustees, 77 N.J. 55, 68, 389 A.2d 465 (1978) (citations omitted). Nonetheless, despite our adherence to statutory exceptions expressly and unambiguously set forth by the Legislature, we are mindful that “[e]xemptions from remedial statutes should generally be narrowly construed.”Poff v. Caro, 228 N.J.Super. 370, 379, 549 A.2d 900 (Law Div.1987) (citing Service Armament Co. v. Hyland, 70 N.J. 550, 559, 362 A.2d 13 (1976)).

 

We begin with the “distinctly private” exception. The LAD provides that “[n]othing herein contained shall be construed to include or to apply to any institution, bona fide club, or place of accommodation, which is in its nature distinctly private.” N.J.S.A. 10:5-5l. Boy Scouts’ status as a bona fide club has not been questioned. Our focus is, therefore, on the meaning of “distinctly private.” We agree with the New York Court of Appeals that this language, found in both the New York Human Rights Law, N.Y. Exec. Law § 292, and in the LAD, is intended as a narrowly drawn statutory exclusion. Power Squadrons, supra, 465 N.Y.S.2d 871, 452 N.E.2d at 1204 (stating that this exception “does not refer simply to private clubs or establishments closed to the public but uses more restrictive language excluding from the statute’s provisions only clubs which are ‘distinctly private’“). Boy Scouts bears the burden of proving that it fits within this narrow exception. Cf. Spragg v. Shore Care & Shore Mem’l Hosp., 293 N.J.Super. 33, 51, 679 A.2d 685 (App.Div.1996) (holding burden of proof on defendant-employer to prove bona fide occupational qualification exception to LAD).

 

In deciding whether Boy Scouts is a place of public accommodation, we considered the organization’s public solicitation activities. Solicitation of a broad membership base is closely related to the issue of selectivity in membership, which may explain why various courts have considered both factors in their analyses of both “place of public accommodation” and the “distinctly private” exception. See, e.g., Kiwanis, supra, 806 F.2d at 476 (stating that “distinctly private” exception “represents the other side of the ‘public accommodation’ coin …. because of the emphasis placed on ‘selectivity’ as the standard for determining ‘public accommodation,’ as well as for determining if a club is ‘distinctly private’“). We have reviewed the multiple ways in which Boy Scouts reaches out to the public and, therefore, will consider the selectivity issue as the principal determinant of “distinctly private” status. See Power Squadrons, supra, 465 N.Y.S.2d 871, 452 N.E.2d at 1204 (stating that “the essence of a private club is selectivity in its membership”).

 

Thirty-three years ago, in Clover Hill Swimming Club, Inc. v. Goldsboro, we said that “not every establishment using the ‘club’ label can be considered ‘distinctly private.’ Self-serving declarations by … an accommodation are not determinative of its character.” 47 N.J. at 34, 219 A.2d 161. Although the swimming club had represented to the public that “all applications [for membership] would be subject to approval by club officials,” it appeared that Clover Hill was only selective when black families applied. Ibid. The Court refused to accept bogus representations concerning the “private” nature of the club when it was quite clear that membership was generally open and had to do with a family’s interest in recreation and not much else. Ibid. Little League, citing Clover Hill, primarily relied on the baseball league’s “open [invitation] to children in the community at large, with no restriction (other than sex) whatever” as a basis for the court’s finding that the league was a “public accommodation.” 127 N.J.Super. at 531, 318 A.2d 33. The lack of any membership selectivity–except for the prohibition against the admission of girls– weighed in the public accommodation calculus; it also bears upon the “distinctly private” exception.

 

Kiwanis International v. Ridgewood Kiwanis Club is the only case to hold a club exempt under the “distinctly private” exception. 806 F.2d at 477. The Third Circuit, relying on Little League, applied a selectivity analysis to determine whether Kiwanis Ridgewood was a public accommodation and, therefore, not “distinctly private.” Id. at 476-77. The court found that the local club was selective based on its membership practices, which were described as follows:

 

 

The Ridgewood club is small, comprised of only twenty-eight members. Ten individuals have been members for over twenty years. Indeed, Kiwanis Ridgewood has admitted no more than twenty members over the course of the past decade. Each new member had to be sponsored by a current member, and formally voted in by the Ridgewood Board of Directors. The sponsorship of the existing member acted as a primary screening mechanism in the maintenance of the quality of membership. In addition to national membership requirements, Kiwanis Ridgewood established several local membership requirements, which included, among others, the candidate’s willingness to pray at meetings and to recite the pledge of allegiance.

 

 

 

Although Kiwanis International has encouraged large-scale membership solicitation in the past, the suggested “membership roundup” mailings were sent only to those prospects already known by current members. These individuals would be invited to a Kiwanis meeting to determine their compatibility with the organization’s goals and members. The scope of these membership drives was limited. Not only did every solicited individual have to be known by an existing member, but every applicant out of that group of solicited individuals would have to be sponsored by an existing member.

 

 

[Id. at 475.]

 

Unlike Kiwanis Ridgewood, which used “sponsorship [by an] existing member … as a primary screening mechanism in the maintenance of … quality membership,” Boy Scouts does not require new members “to be sponsored by a current member.” Ibid. Nor does Boy Scouts limit its recruiting, or invitations to the public, to individuals who are “known by an existing member.” To the contrary, Boy Scout publications indicate that the organization seeks a broad membership base. In a booklet, entitled A Representative Membership,5 Boy Scouts states that its “national objective, as well as for regions, areas, councils, and districts is to see that all eligible youth have the opportunity to affiliate with the Boy Scouts of America.” Id. at 1 (emphasis added). The booklet is emphatically inclusive:

 

 

We have high hopes for our nation’s future. These hopes cannot flower if any part of our citizenry feels deprived of the opportunity to help shape the future. How can you persuade other Scouters to accept a commitment to a representative membership? Consider these facts:

 

 

 

1. Our federal charter sets forth our obligation to serve boys. Neither the charter nor the bylaws of the Boy Scouts of America permits the exclusion of any boy. The National Council and Executive Board have always taken the position that Scouting should be available for all boys who meet the entrance age requirements.

 

 

….

 

 

4. Another aim of Scouting is the development of leadership. Leadership in America is needed in all sections of the country and in all economic, cultural, and ethnic groups.

 

 

 

5. To meet these responsibilities we have made a commitment that our membership shall be representative of all the population in every community, district, and council.

 

 

[Id. at 2 (emphasis added).]

 

Boy Scouts’ large membership further undercuts its claim to selective membership. Nationally, over four million boys and one million adults were Boy Scout members in 1992.6 Since its inception, over 87 million people have joined Boy Scouts. In 1991, Monmouth Council alone had over 8400 youths and over 2700 adult members. The New York Court of Appeals, construing “distinctly private” in United States Power Squadrons v. State Human Rights Appeal Board, has suggested that an organization’s failure to limit its maximum membership, in and of itself, demonstrates that the club is not private: “Organizations which routinely accept applicants and place no subjective limits on the number of persons eligible for membership are not private clubs.” 465 N.Y.S.2d 871, 452 N.E.2d at 1204. We note only that the size of the Boy Scout organization certainly implies an open membership policy.

 

Boy Scouts argues, however, that it is “distinctly private” because its Scout Oath and Scout Law constitute genuine selectivity criteria. In support of its position, Boy Scouts relies on Welsh v. Boy Scouts of_ America, wherein the Seventh Circuit stated:

 

 

Although the Scouts intentionally admit a large number of boys from diverse backgrounds, admission to membership is not without exercise of sound discretion and judgment. This is evident from the Constitution and By-laws as well as the Boy Scouts’ Oath and Scout Law.

 

 

 

… We hold therefore that the Scouts organization not only is selective, but that its very Constitution, By-laws and doctrine dictate that it remain selective.

 

 

[993 F.2d at 1276-77.]

 

We acknowledge that Boy Scouts’ membership application requires members to comply with the Scout Oath and Law. We do not find, however, that the Oath and Law operate as genuine selectivity criteria. To the contrary, the record discloses few instances in which the Oath and Law have been used to exclude a prospective member; in practice, they present no real impediment to joining Boy Scouts. Joining requirements are insufficient to establish selectivity where they do not function as true limits on the admission of members. See Power Squadrons, supra, 465 N.Y.S.2d 871, 452 N.E.2d at 1204 (requiring examination for basic boating course was not “selective” where club “place[d] no subjective limits on the number of persons eligible for membership”). Here, there is no evidence that Boy Scouts does anything but accept at face value a scout’s affirmation of the Oath and Law. See Roberts v. United States Jaycees, 468 U.S. 609, 621, 104 S.Ct. 3244, 3251, 82 L.Ed.2d 462, 473 (1984) (finding group unselective where “new members are routinely recruited and admitted with no inquiry into their backgrounds”).

 

Most important, it is clear that Boy Scouts does not limit its membership to individuals who belong to a particular religion or subscribe to a specific set of moral beliefs. Boy Scouts asserts that “[t]here is a close association between the Boy Scouts of America and virtually all religious bodies and denominations in the United States,” and that each member’s concept of “moral fitness” should be determined by his “courage to do what his head and heart tell him is right.” See supra at 575-76, 734 A.2d at 1203. Moreover, Boy Scouts encourages its members to “respect and defend the rights of others whose beliefs may differ.” Scoutmaster Handbook, supra, at 561. By its own teachings then, Boy Scouts is inclusive, not selective, in its membership practices.

 

Boy Scouts also argues that it is “distinctly private” because it is selective in its adult membership. In addition to the Scout Oath and Law requirements, adult members are bound by the Declaration of Religious Principle, and are subject to evaluation according to informal criteria designed to select only individuals capable of accepting responsibility for the moral education and care of other people’s children in accordance with scouting values. Several of the Troop 73 leaders who were involved in Dale’s adult membership approval have said that they would not have approved Dale’s application had they known that Dale was an “avowed” homosexual, thus lending support to BSA’s position.

 

The Appellate Division’s analysis of Boy Scouts’ adult membership selectivity dispels the notion that an open membership organization can claim the “distinctly private” exception because it is selective as to a small subset of the larger group:

 

 

We reject the suggestion that the BSA organization as a whole is not a place of public accommodation because more stringent membership criteria are applied to a single component of the organization, its adult members. Such a result is clearly inconsistent with the remedial purposes of the LAD. Acceptance of the argument would mean that public clubs in Clover Hill and Fraser, are not places of public accommodation because their member-counselors or lifeguards are subject to more stringent, enhanced training criteria. An extension of defendants’ argument would be that the BSA is not a place of public accommodation because of the demanding standards that must be met to become an Eagle Scout.

 

 

[Dale, supra, 308 N.J.Super. at 538, 706 A.2d 270 (citations omitted).]

 

See also Brounstein, supra, 839 F.Supp. at 1107-08 (stating that “[t]he fact that an organization is selective with respect to the privileges and benefits it accords to members does not exempt that organization from the proscriptions of the LAD if it is otherwise a ‘public place of accommodation’“).

 

Boy Scouts accepts boys who come from diverse cultures and who belong to different religions. It teaches tolerance and understanding of differences in others. It presents itself to its members and to the public generally as a nonsectarian organization “available to all boys who meet the entrance age requirements.” Its Charter and its Bylaws do not permit the exclusion of any boy. Boy Scouts is not “distinctly private” because it is not selective in its membership.

 

Boy Scouts claims, however, that it is exempt from the LAD because it is an “educational facility operated or maintained by a bona fide religious or sectarian institution.” N.J.S.A. 10:5-5l. This claim deserves little discussion. Boy Scouts repeatedly states that it is nonsectarian. Its Bylaws declare that no member shall be required “to take part in or observe a religious ceremony distinctly unique” to a church or other religious organization. Boy Scouts emphasizes that religious instruction is better reserved for “the home and the organization or group with which the member is connected.” Further, the Scoutmaster Handbook instructs its leaders that scouting “is identified with no particular faith, encourages no particular affiliation, nor assumes functions of religious bodies.” We cannot say that Boy Scouts is a “bona fide religious or sectarian institution” in the face of the organization’s clear pronouncements on this subject.7

 

… .

 

We hold that Boy Scouts is a “place of public accommodation” and is not exempt from the LAD under any of the statute’s exceptions.

 

[The court went on to hold that the Boy Scouts’ discriminatory membership policy was not protected by the First Amendement. This holding, and thus the outcome of this case, was reversed by the Supreme Court of the United States in Boy Scouts of America v. Dale, 530 U.S. 640 (2000).]

 


    1. Dale subsequently learned that in 1978 BSA had prepared a position paper stating that “an individual who openly declares himself to be a homosexual [may not] be a volunteer scout leader [or] … a registered unit member[.]” The position paper “was never distributed. Statements were also written in 1991 and 1993 expressing similar positions. These statements were written after the onset of litigation in other states charging the organization with discrimination against members on the basis of sexual orientation.

 

    1. N.J.S.A. 10:5-5l now reads:

       

      “A place of public accommodation” shall include, but not be limited to: any tavern, roadhouse, hotel, motel, trailer camp, summer camp, day camp, or resort camp, whether for entertainment of transient guests or accommodation of those seeking health, recreation or rest; any producer, manufacturer, wholesaler, distributor, retail shop, store, establishment, or concession dealing with goods or services of any kind; any restaurant, eating house, or place where food is sold for consumption on the premises; any place maintained for the sale of ice cream, ice and fruit preparations or their derivatives, soda water or confections, or where any beverages of any kind are retailed for consumption on the premises; any garage, any public conveyance operated on land or water, or in the air, any stations and terminals thereof; any bathhouse, boardwalk, or seashore accommodation; any auditorium, meeting place, or hall; any theatre, motion-picture house, music hall, roof garden, skating rink, swimming pool, amusement and recreation park, fair, bowling alley, gymnasium, shooting gallery, billiard and pool parlor, or other place of amusement; any comfort station; any dispensary, clinic or hospital; any public library; any kindergarten, primary and secondary school, trade or business school, high school, academy, college and university, or any educational institution under the supervision of the State Board of Education, or the Commissioner of Education of the State of New Jersey. Nothing herein contained shall be construed to include or to apply to any institution, bona fide club, or place of accommodation, which is in its nature distinctly private; nor shall anything herein contained apply to any educational facility operated or maintained by a bona fide religious or sectarian institution, and the right of a natural parent or one in loco parentis to direct the education and upbringing of a child under his control is hereby affirmed; nor shall anything herein contained be construed to bar any private secondary or post secondary school from using in good faith criteria other than race, creed, color, national origin, ancestry or affectional or sexual orientation in the admission of students.

 

    1. Boy Scouts expresses concern that this article is not properly part of the record before us. Although the quoted statement has not been authenticated, we find it descriptive of material in the record respecting BSA’s public solicitation and membership recruitment efforts.

 

    1. New Jersey governmental entities are, of course, bound by the LAD. Their sponsorship of, or conferring of special benefits on, an organization that practices discrimination would be prohibited.

 

    1. Boy Scouts also questions whether this booklet is properly before us. See supra at 590 n. 6, 734 A.2d at 1211 n. 6). The booklet on its face states that it is a BSA publication prepared for national, council, district, and local board/committee members, and Boy Scouts has not indicated otherwise.

 

    1. Boy Scouts argues that this Court should follow Kiwanis, supra, 806 F.2d at 476 n. 14, and limit review of Boy Scouts’ membership selection practices to the local, rather than the national level. We decline to follow Kiwanis in this case. Boy Scouts’ local units, unlike Kiwanis Ridgewood, are not authorized to establish additional “local membership requirements,” id. at 475, nor are they empowered generally to change BSA’s policies. We find that the various levels of scouting are interrelated such that a review of the national organization’s membership selection practices–as opposed to the local unit–is most appropriate.

 

    1. That Boy Scouts’ oath expresses a belief in God does not make it a religious institution. Nor does Boy Scouts’ commitment to “[e]ducation and fun,” see supra at 594, 734 A.2d at 1213 (emphasis added), qualify it as an “educational facility” under N.J.S.A. 10:5-5l.

 

 

 

Excerpt from TITLE II OF THE CIVIL RIGHTS ACT

 

 

 

42 U.S.C. §2000a

 

(a)All persons shall be entitled to the full and equal enjoyment of the goods, services, facilities, privileges, advantages, and accommodations of any place of public accommodation, as defined in this section, without discrimination on the ground of race, color, religion, or national origin.

 

(b) Each of the following establishments is a place of public accommodation within this title if its operations affect commerce, or if discrimination or segregation by it is supported by State action:

 

 

(1) any inn, hotel, motel, or other establishment which provides lodging to transient guests, other than an establishment located within a building which contains not more than five rooms for rent or hire and which is actually occupied by the proprietor of such establishment as his residence.

(2) any restaurant, cafeteria, lunchroom, lunch counter, soda fountain, or other facility principally engaged in selling food for consumption on the premises, including, but not limited to, any such facility located on the premises of any retail establishment, or any gasoline station;

(3) any motion picture house, theater, concert hall, sports arena, stadium or other place of exhibition or entertainment; and

(4) any establishment (A)(i) which is physically located within the premises of any establishment otherwise covered by this subsection, or (ii) within the premises of which is physically located any such covered establishment and (B) which holds itself out as serving patrons of any such covered establishment.

 

 

 

 

(c) The operations of an establishment affect commerce within the meaning of this title if (1) it is one of the establishments described in paragraph (1) of subsection (b); (2) in the case of an establishment described in paragraph (2) of subsection (b), it serves or offers to serve interstate travelers or a substantial portion of the food which it serves or gasoline or other products which it sells, has moved in commerce; (3) in the case of an establishment described in paragraph (3) of subsection (b), it customarily presents films, performances, athletic teams, exhibitions, or other sources of entertainment which move in commerce, and (4) in the case of an establishment described in paragraph (4) of subsection (b), it is physically located within the premises of, or there is physically located within its premises, an establishment the operations of which affect commerce within the meaning of this subsection. For purposes of this section, “commerce” means travel, trade, traffic, commerce, transportation, or communication among the several States, or between the District of Columbia and any State, or between any foreign country or any territory or possession and any state or the District of Columbia, or between points in the same State but through any other State or the District of Columbia or a foreign country.

 

(e) The provisions of this title shall not apply to a private club or other establishment not in fact open to the public, except to the extent that the facilities of such establishment are made available to the customers or patrons of an establishment within the scope of subsection (b).

 

7.3.3. Americans with Disabilities Act

 

Americans with Disabilities Act, 42 U.S.C. § 12101

 

as amended by the ADA Amendments Act of 2008

 

 

 

§12102. DEFINITION OF DISABILITY.

 

As used in this Act:

 

 

 

(1) DISABILITY. – The term ‘disability’ means, with respect to an individual –

 

 

(A) a physical or mental impairment that substantially limits one or more major life activities of such individual;

(B) a record of such an impairment; or

(C) being regarded as having such an impairment (as described in paragraph (3)).

 

 

(2) MAJOR LIFE ACTIVITIES.–

 

 

(A) IN GENERAL.–For purposes of paragraph (1), major life activities include, but are not limited to, caring for oneself, performing manual tasks, seeing, hearing, eating, sleeping, walking, standing, lifting, bending, speaking, breathing, learning, reading, concentrating, thinking, communicating, and working.

(B) MAJOR BODILY FUNCTIONS.–For purposes of paragraph (1), a major life activity also includes the operation of a major bodily function, including but not limited to, functions of the immune system, normal cell growth, digestive, bowel, bladder, neurological, brain, respiratory, circulatory, endocrine, and reproductive functions.

 

 

(3) REGARDED AS HAVING SUCH AN IMPAIRMENT.–For purposes of paragraph (1)(C):

 

 

(A) An individual meets the requirement of ‘being regarded as having such an impairment’ if the individual establishes that he or she has been subjected to an action prohibited under this Act because of an actual or perceived physical or mental impairment whether or not the impairment limits or is perceived to limit a major life activity.

(B) Paragraph (1)(C) shall not apply to impairments that are transitory and minor. A transitory impairment is an impairment with an actual or expected duration of 6 months or less.

 

 

(4) RULES OF CONSTRUCTION REGARDING THE DEFINITION OF DISABILITY.–The definition of ‘disability’ in paragraph (1) shall be construed in accordance with the following:

 

 

(A) The definition of disability in this Act shall be construed in favor of broad coverage of individuals under this Act, to the maximum extent permitted by the terms of this Act.

(B) The term ‘substantially limits’ shall be interpreted consistently with the findings and purposes of the ADA Amendments Act of 2008.

(C) An impairment that substantially limits one major life activity need not limit other major life activities in order to be considered a disability.

(D) An impairment that is episodic or in remission is a disability if it would substantially limit a major life activity when active.

(E)(i) The determination of whether an impairment substantially limits a major life activity shall be made without regard to the ameliorative effects of mitigating measures such as–

 

 

(I) medication, medical supplies, equipment, or appliances, low-vision devices (which do not include ordinary eye glasses or contact lenses), prosthetics including limbs and devices, hearing aids and cochlear implants or other implantable hearing devices, mobility devices, or oxygen therapy equipment and supplies;

(II) use of assistive technology;

(III) reasonable accommodations or auxiliary aids or services; or

(IV) learned behavioral or adaptive neurological modifications.

 

 

(E)(ii) The ameliorative effects of the mitigating measures of ordinary eyeglasses or contact lenses shall be considered in determining whether an impairment substantially limits a major life activity.

(E)(iii) As used in this subparagraph–

 

 

(I) the term ‘ordinary eyeglasses or contact lenses’ means lenses that are intended to fully correct visual acuity or eliminate refractive error; and

(II) the term ‘low-vision devices’ means devices that magnify, enhance, or otherwise augment a visual image.

 

 

 

… .

 

SUBCHAPTER III – PUBLIC ACCOMMODATIONS AND SERVICES OPERATED BY PRIVATE ENTITIES

 

§12181. DEFINITIONS.

 

As used in this title:

 

… .

 

(7) Public accommodation. The following private entities are considered public accommodations for purposes of this title, if the operations of such entities affect commerce

 

 

(A) an inn, hotel, motel, or other place of lodging, except for an establishment located within a building that contains not more than five rooms for rent or hire and that is actually occupied by the proprietor of such establishment as the residence of such proprietor;

(B) a restaurant, bar, or other establishment serving food or drink;

(C) a motion picture house, theater, concert hall, stadium, or other place of exhibition or entertainment;

(D) an auditorium, convention center, lecture hall, or other place of public gathering;

(E) a bakery, grocery store, clothing store, hardware store, shopping center, or other sales or rental establishment;

(F) a laundromat, dry-cleaner, bank, barber shop, beauty shop, travel service, shoe repair service, funeral parlor, gas station, office of an accountant or lawyer, pharmacy, insurance office, professional office of a health care provider, hospital, or other service establishment;

(G) a terminal, depot, or other station used for specified public transportation;

(H) a museum, library, gallery, or other place of public display or collection;

(I) a park, zoo, amusement park, or other place of recreation;

(J) a nursery, elementary, secondary, undergraduate, or postgraduate private school, or other place of education;

(K) a day care center, senior citizen center, homeless shelter, food bank, adoption agency, or other social service center establishment; and

(L) a gymnasium, health spa, bowling alley, golf course, or other place of exercise or recreation.

 

 

… .

 

(9) Readily achievable. The term “readily achievable” means easily accomplishable and able to be carried out without much difficulty or expense. In determining whether an action is readily achievable, factors to be considered include

 

 

(A) the nature and cost of the action needed under this Act;

(B) the overall financial resources of the facility or facilities involved in the action; the number of persons employed at such facility; the effect on expenses and resources, or the impact otherwise of such action upon the operation of the facility;

(C) the overall financial resources of the covered entity; the overall size of the business of a covered entity with respect to the number of its employees; the number, type, and location of its facilities; and

(D) the type of operation or operations of the covered entity, including the composition, structure, and functions of the workforce of such entity; the geographic separateness, administrative or fiscal relationship of the facility or facilities in question to the covered entity.

 

 

… .

 

§12182. PROHIBITION OF DISCRIMINATION BY PUBLIC ACCOMMODATIONS.

 

(a) General Rule. No individual shall be discriminated against on the basis of disability in the full and equal enjoyment of the goods, services, facilities, privileges, advantages, or accommodations of any place of public accommodation by any person who owns, leases (or leases to), or operates a place of public accommodation.

 

(b) Construction.

 

 

(1) General prohibition.

 

 

(A) Activities.

 

 

(i) Denial of participation. It shall be discriminatory to subject an individual or class of individuals on the basis of a disability or disabilities of such individual or class, directly, or through contractual, licensing, or other arrangements, to a denial of the opportunity of the individual or class to participate in or benefit from the goods, services, facilities, privileges, advantages, or accommodations of an entity.

(ii) Participation in unequal benefit. It shall be discriminatory to afford an individual or class of individuals, on the basis of a disability or disabilities of such individual or class, directly, or through contractual, licensing, or other arrangements with the opportunity to participate in or benefit from a good, service, facility, privilege, advantage, or accommodation that is not equal to that afforded to other individuals.

(iii) Separate benefit. It shall be discriminatory to provide an individual or class of individuals, on the basis of a disability or disabilities of such individual or class, directly, or through contractual, licensing, or other arrangements with a good, service, facility, privilege, advantage, or accommodation that is different or separate from that provided to other individuals, unless such action is necessary to provide the individual or class of individuals with a good, service, facility, privilege, advantage, or accommodation, or other opportunity that is as effective as that provided to others.

(iv) Individual or class of individuals. For purposes of clauses (i) through (iii) of this subparagraph, the term “individual or class of individuals” refers to the clients or customers of the covered public accommodation that enters into the contractual, licensing or other arrangement.

 

 

(B) Integrated settings. Goods, services, facilities, privileges, advantages, and accommodations shall be afforded to an individual with a disability in the most integrated setting appropriate to the needs of the individual.

(C) Opportunity to participate. Notwithstanding the existence of separate or different programs or activities provided in accordance with this section, an individual with a disability shall not be denied the opportunity to participate in such programs or activities that are not separate or different.

(D) Administrative methods. An individual or entity shall not, directly or through contractual or other arrangements, utilize standards or criteria or methods of administration

 

 

(i) that have the effect of discriminating on the basis of disability; or (ii) that perpetuate the discrimination of others who are subject to common administrative control.

 

 

(E) Association. It shall be discriminatory to exclude or otherwise deny equal goods, services, facilities, privileges, advantages, accommodations, or other opportunities to an individual or entity because of the known disability of an individual with whom the individual or entity is known to have a relationship or association.

 

 

(2) Specific prohibitions.

 

 

(A) Discrimination. For purposes of subsection (a) of this section, discrimination includes

 

 

(i) the imposition or application of eligibility criteria that screen out or tend to screen out an individual with a disability or any class of individuals with disabilities from fully and equally enjoying any goods, services, facilities, privileges, advantages, or accommodations, unless such criteria can be shown to be necessary for the provision of the goods, services, facilities, privileges, advantages, or accommodations being offered;

(ii) a failure to make reasonable modifications in policies, practices, or procedures, when such modifications are necessary to afford such goods, services, facilities, privileges, advantages, or accommodations to individuals with disabilities, unless the entity can demonstrate that making such modifications would fundamentally alter the nature of such goods, services, facilities, privileges, advantages, or accommodations;

(iii) a failure to take such steps as may be necessary to ensure that no individual with a disability is excluded, denied services, segregated or otherwise treated differently than other individuals because of the absence of auxiliary aids and services, unless the entity can demonstrate that taking such steps would fundamentally alter the nature of the good, service, facility, privilege, advantage, or accommodation being offered or would result in an undue burden;

(iv) a failure to remove architectural barriers, and communication barriers that are structural in nature, in existing facilities, and transportation barriers in existing vehicles and rail passenger cars used by an establishment for transporting individuals (not including barriers that can only be removed through the retrofitting of vehicles or rail passenger cars by the installation of a hydraulic or other lift), where such removal is readily achievable; and

(v) where an entity can demonstrate that the removal of a barrier under clause (iv) is not readily achievable, a failure to make such goods, services, facilities, privileges, advantages, or accommodations available through alternative methods if such methods are readily achievable.

 

 

 

 

… .

 

§12183. NEW CONSTRUCTION AND ALTERATIONS IN PUBLIC ACCOMMODATIONS AND COMMERCIAL FACILITIES.

 

(a) Application of Term. Except as provided in subsection (b) of this section, as applied to public accommodations and commercial facilities, discrimination for purposes of section 12182(a) includes

 

 

(1) a failure to design and construct facilities for first occupancy later than 30 months after the date of enactment of this Act that are readily accessible to and usable by individuals with disabilities, except where an entity can demonstrate that it is structurally impracticable to meet the requirements of such subsection in accordance with standards set forth or incorporated by reference in regulations issued under this title; and

(2) with respect to a facility or part thereof that is altered by, on behalf of, or for the use of an establishment in a manner that affects or could affect the usability of the facility or part thereof, a failure to make alterations in such a manner that, to the maximum extent feasible, the altered portions of the facility are readily accessible to and usable by individuals with disabilities, including individuals who use wheelchairs. Where the entity is undertaking an alteration that affects or could affect usability of or access to an area of the facility containing a primary function, the entity shall also make the alterations in such a manner that, to the maximum extent feasible, the path of travel to the altered area and the bathrooms, telephones, and drinking fountains serving the altered area, are readily accessible to and usable by individuals with disabilities where such alterations to the path of travel or the bathrooms, telephones, and drinking fountains serving the altered area are not disproportionate to the overall alterations in terms of cost and scope (as determined under criteria established by the Attorney General).

 

 

(b) Elevator. Subsection (a) of this section shall not be construed to require the installation of an elevator for facilities that are less than three stories or have less than 3,000 square feet per story unless the building is a shopping center, a shopping mall, or the professional office of a health care provider or unless the Attorney General determines that a particular category of such facilities requires the installation of elevators based on the usage of such facilities.

 

… .

 

§12187. EXEMPTIONS FOR PRIVATE CLUBS AND RELIGIOUS ORGANIZATIONS.

 

The provisions of this title shall not apply to private clubs or establishments exempted from coverage under title II of the Civil Rights Act of 1964 (42 U.S.C. 2000a(e)) or to religious organizations or entities controlled by religious organizations, including places of worship.

 

… .

 

§12189. EXAMINATIONS AND COURSES.

 

Any person that offers examinations or courses related to applications, licensing, certification, or credentialing for secondary or postsecondary education, professional, or trade purposes shall offer such examinations or courses in a place and manner accessible to persons with disabilities or offer alternative accessible arrangements for such individuals.

 

PGA Tour, Inc. v. Martin,

532 U.S. 661 (2001)

 

 

 

CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT

 

 

 

Stevens, J., delivered the opinion of the Court, in which Rehnquist, C. J., and O’Connor, Kennedy, Souter, Ginsburg, and Breyer, JJ., joined. Scalia, J., filed a dissenting opinion, in which Thomas, J., joined, post, p. 691.

 

H. Bartow Farr III argued the cause for petitioner. With him on the briefs were Richard G. Taranto, William J. Maledon, and Andrew D. Hurtiwz.

 

Roy L. Reardon argued the cause for respondent. With him on the brief was Joseph M. McLaughlin.

 

Deputy Solicitor General Underwood argued the cause for the United States as amicus curiae urging affirmance. With her on the brief were Solicitor General Waxman, Assistant Attorney General Lee, Patricia A. Millett, Jessica Dunsay Silver, and Thomas E. Chandler.

 

 

 

Justice Stevens, delivered the opinion of the Court.

 

 

 

This case raises two questions concerning the application of the Americans with Disabilities Act of 1990, 42 U. S. C. § 12101 et seq., to a gifted athlete: first, whether the Act protects access to professional golf tournaments by a qualified entrant with a disability; and second, whether a disabled contestant may be denied the use of a golf cart because it would “fundamentally alter the nature” of the tournaments, § 12182(b)(2)(A)(ii), to allow him to ride when all other contestants must walk.

 

 

 

 

I

 

 

 

 

Petitioner PGA TOUR, Inc., a nonprofit entity formed in 1968, sponsors and cosponsors professional golf tournaments conducted on three annual tours. About 200 golfers participate in the PGA TOUR; about 170 in the NIKE TOUR; and about 100 in the SENIOR PGA TOUR. PGA TOUR and NIKE TOUR tournaments typically are 4-day events, played on courses leased and operated by petitioner. The entire field usually competes in two 18-hole rounds played on Thursday and Friday; those who survive the “cut” play on Saturday and Sunday and receive prize money in amounts determined by their aggregate scores for all four rounds. The revenues generated by television, admissions, concessions, and contributions from cosponsors amount to about $300 million a year, much of which is distributed in prize money.

 

There are various ways of gaining entry into particular tours. For example, a player who wins three NIKE TOUR events in the same year, or is among the top-15 money winners on that tour, earns the right to play in the PGA TOUR. Additionally, a golfer may obtain a spot in an official tournament through successfully competing in “open” qualifying rounds, which are conducted the week before each tournament. Most participants, however, earn playing privileges in the PGA TOUR or NIKE TOUR by way of a three-stage qualifying tournament known as the “Q-School.”

 

Any member of the public may enter the Q-School by paying a $3,000 entry fee and submitting two letters of reference from, among others, PGA TOUR or NIKE TOUR members. The $3,000 entry fee covers the players’ greens fees and the cost of golf carts, which are permitted during the first two stages, but which have been prohibited during the third stage since 1997. Each year, over a thousand contestants compete in the first stage, which consists of four 18-hole rounds at different locations. Approximately half of them make it to the second stage, which also includes 72 holes. Around 168 players survive the second stage and advance to the final one, where they compete over 108 holes. Of those finalists, about a fourth qualify for membership in the PGA TOUR, and the rest gain membership in the NIKE TOUR. The significance of making it into either tour is illuminated by the fact that there are about 25 million golfers in the country.

 

Three sets of rules govern competition in tour events. First, the “Rules of Golf,” jointly written by the United States Golf Association (USGA) and the Royal and Ancient Golf Club of Scotland, apply to the game as it is played, not only by millions of amateurs on public courses and in private country clubs throughout the United States and worldwide, but also by the professionals in the tournaments conducted by petitioner, the USGA, the Ladies’ Professional Golf Association, and the Senior Women’s Golf Association. Those rules do not prohibit the use of golf carts at any time.1

 

Second, the “Conditions of Competition and Local Rules,” often described as the “hard card,” apply specifically to petitioner’s professional tours. The hard cards for the PGA TOUR and NIKE TOUR require players to walk the golf course during tournaments, but not during open qualifying rounds.2 On the SENIOR PGA TOUR, which is limited to golfers age 50 and older, the contestants may use golf carts. Most seniors, however, prefer to walk.3

 

Third, “Notices to Competitors” are issued for particular tournaments and cover conditions for that specific event. Such a notice may, for example, explain how the Rules of Golf should be applied to a particular water hazard or manmade obstruction. It might also authorize the use of carts to speed up play when there is an unusual distance between one green and the next tee.

 

The basic Rules of Golf, the hard cards, and the weekly notices apply equally to all players in tour competitions. As one of petitioner’s witnesses explained with reference to “the Masters Tournament, which is golf at its very highest level, … the key is to have everyone tee off on the first hole under exactly the same conditions and all of them be tested over that 72-hole event under the conditions that exist during those four days of the event.” App. 192.

 

 

 

 

II

 

 

 

 

Casey Martin is a talented golfer. As an amateur, he won 17 Oregon Golf Association junior events before he was 15, and won the state championship as a high school senior. He played on the Stanford University golf team that won the 1994 National Collegiate Athletic Association (NCAA) championship. As a professional, Martin qualified for the NIKE TOUR in 1998 and 1999, and based on his 1999 performance, qualified for the PGA TOUR in 2000. In the 1999 season, he entered 24 events, made the cut 13 times, and had 6 top-10 finishes, coming in second twice and third once.

 

Martin is also an individual with a disability as defined in the Americans with Disabilities Act of 1990 (ADA or Act).4 Since birth he has been afflicted with Klippel-TrenaunayWeber Syndrome, a degenerative circulatory disorder that obstructs the flow of blood from his right leg back to his heart. The disease is progressive; it causes severe pain and has atrophied his right leg. During the latter part of his college career, because of the progress of the disease, Martin could no longer walk an 18-hole golf course.5 Walking not only caused him pain, fatigue, and anxiety, but also created a significant risk of hemorrhaging, developing blood clots, and fracturing his tibia so badly that an amputation might be required. For these reasons, Stanford made written requests to the Pacific 10 Conference and the NCAA to waive for Martin their rules requiring players to walk and carry their own clubs. The requests were granted.6

 

When Martin turned pro and entered petitioner’s Q-School, the hard card permitted him to use a cart during his successful progress through the first two stages. He made a request, supported by detailed medical records, for permission to use a golf cart during the third stage. Petitioner refused to review those records or to waive its walking rule for the third stage. Martin therefore filed this action. A preliminary injunction entered by the District Court made it possible for him to use a cart in the final stage of the Q-School and as a competitor in the NIKE TOUR and PGA TOUR. Although not bound by the injunction, and despite its support for petitioner’s position in this litigation, the USGA voluntarily granted Martin a similar waiver in events that it sponsors, including the U. S. Open.

 

 

 

 

III

 

 

 

 

[The Court recounts the procedural history of the case and summarizes the rulings below, namely that the PGA Tour is not a private club, that it is a place of public accommodation, and that granting Martin the use of a court would not fundamentally alter the nature of the game. The passage below is notable for the testimony excerpted in footnotes. The Court also went on to note that the Seventh Circuit had reached opposite conclusion concerning the fundamental nature of walking to the game.]

 

… .

 

At trial, petitioner did not contest the conclusion that Martin has a disability covered by the ADA, or the fact “that his disability prevents him from walking the course during a round of golf.” 994 F. Supp. 1242, 1244 (Ore. 1998). Rather, petitioner asserted that the condition of walking is a substantive rule of competition, and that waiving it as to any individual for any reason would fundamentally alter the nature of the competition. Petitioner’s evidence included the testimony of a number of experts, among them some of the greatest golfers in history. Arnold Palmer,7 Jack Nicklaus,8 and Ken Venturi9 explained that fatigue can be a critical factor in a tournament, particularly on the last day when psychological pressure is at a maximum. Their testimony makes it clear that, in their view, permission to use a cart might well give some players a competitive advantage over other players who must walk. They did not, however, express any opinion on whether a cart would give Martin such an advantage.10

 

… .

 

 

 

 

IV

 

 

 

 

Congress enacted the ADA in 1990 to remedy widespread discrimination against disabled individuals. In studying the need for such legislation, Congress found that “historically, society has tended to isolate and segregate individuals with disabilities, and, despite some improvements, such forms of discrimination against individuals with disabilities continue to be a serious and pervasive social problem.” 42 U. S. C. § 12101(a)(2); see § 12101(a)(3) (“[D]iscrimination against individuals with disabilities persists in such critical areas as employment, housing, public accommodations, education, transportation, communication, recreation, institutionalization, health services, voting, and access to public services”). Congress noted that the many forms such discrimination takes include “outright intentional exclusion” as well as the “failure to make modifications to existing facilities and practices.” § 12101(a)(5). After thoroughly investigating the problem, Congress concluded that there was a “compelling need” for a “clear and comprehensive national mandate” to eliminate discrimination against disabled individuals, and to integrate them “into the economic and social mainstream of American life.” S. Rep. No. 101-116, p. 20 (1989); H. R. Rep. No. 101-485, pt. 2, p. 50 (1990).

 

In the ADA, Congress provided that broad mandate. See 42 U. S. C. § 12101(b). In fact, one of the Act’s “most impressive strengths” has been identified as its “comprehensive character,” Hearings on S. 933 before the Senate Committee on Labor and Human Resources and the Subcommittee on the Handicapped, 101st Cong., 1st Sess., 197 (1989) (statement of Attorney General Thornburgh), and accordingly the Act has been described as “a milestone on the path to a more decent, tolerant, progressive society,” Board of Trustees of Univ. of Ala. v. Garrett, 531 U. S. 356, 375 (2001) (Kennedy, J., concurring). To effectuate its sweeping purpose, the ADA forbids discrimination against disabled individuals in major areas of public life, among them employment (Title I of the Act),11 public services (Title II),12 and public accommodations (Title III).13 At issue now, as a threshold matter, is the applicability of Title III to petitioner’s golf tours and qualifying rounds, in particular to petitioner’s treatment of a qualified disabled golfer wishing to compete in those events.

 

Title III of the ADA prescribes, as a “[g]eneral rule”:

 

 

“No individual shall be discriminated against on the basis of disability in the full and equal enjoyment of the goods, services, facilities, privileges, advantages, or accommodations of any place of public accommodation by any person who owns, leases (or leases to), or operates a place of public accommodation.” 42 U. S. C. § 12182(a).

 

 

The phrase “public accommodation” is defined in terms of 12 extensive categories,14 which the legislative history indicates “should be construed liberally” to afford people with disabilities “equal access” to the wide variety of establishments available to the nondisabled.15

 

It seems apparent, from both the general rule and the comprehensive definition of “public accommodation,” that petitioner’s golf tours and their qualifying rounds fit comfortably within the coverage of Title III, and Martin within its protection. The events occur on “golf course[s],” a type of place specifically identified by the Act as a public accommodation. § 12181(7)(L). In addition, at all relevant times, petitioner “leases” and “operates” golf courses to conduct its Q-School and tours. § 12182(a). As a lessor and operator of golf courses, then, petitioner must not discriminate against any “individual” in the “full and equal enjoyment of the goods, services, facilities,privileges, advantages, or accommodations” of those courses. Ibid. Certainly, among the “privileges” offered by petitioner on the courses are those of competing in the Q-School and playing in the tours; indeed, the former is a privilege for which thousands of individuals from the general public pay, and the latter is one for which they vie. Martin, of course, is one of those individuals. It would therefore appear that Title III of the ADA, by its plain terms, prohibits petitioner from denying Martin equal access to its tours on the basis of his disability. Cf. Pennsylvania Dept. of Corrections v. Yeskey, 524 U. S. 206, 209 (1998) (holding that text of Title II’s prohibition of discrimination by “public entities” against disabled individuals “unmistakably includes State prisons and prisoners within its coverage”).

 

Petitioner argues otherwise. To be clear about its position,it does not assert (as it did in the District Court) that it is a private club altogether exempt from Title III’ scoverage. In fact, petitioner admits that its tournaments are conducted at places of public accommodation.16 Nor does petitioner contend (as it did in both the District Court and the Court of Appeals) that the competitors’ area “behind the ropes” is not a public accommodation, notwithstanding the status of the rest of the golf course. Rather, petitioner reframes the coverage issue by arguing that the competing golfers are not members of the class protected by Title III of the ADA.17

 

According to petitioner, Title III is concerned with discrimination against “clients and customers” seeking to obtain “goods and services” at places of public accommodation, whereas it is Title I that protects persons who work at such places.18 As the argument goes, petitioner operates not a “golf course” during its tournaments but a “place of exhibition or entertainment,” 42 U. S. C. § 12181(7)(C), and a professional golfer such as Martin, like an actor in a theater production, is a provider rather than a consumer of the entertainment that petitioner sells to the public. Martin therefore cannot bring a claim under Title III because he is not one of the ”’clients or customers of the covered public accommodation.’ ”19 Rather, Martin’s claim of discrimination is “job-related”20 and could only be brought under Title I–but that Title does not apply because he is an independent contractor (as the District Court found) rather than an employee.

 

The reference to “clients or customers” that petitioner quotes appears in 42 U. S. C. § 12182(b)(1)(A)(iv), which states: “For purposes of clauses (i) through (iii) of this subparagraph, the term ‘individual or class of individuals’ refers to the clients or customers of the covered public accommodation that enters into the contractual, licensing or other arrangement.” Clauses (i) through (iii) of the subparagraph prohibit public accommodations from discriminating against a disabled “individual or class of individuals” in certain ways21 either directly or indirectly through contractual arrangements with other entities. Those clauses make clear on the one hand that their prohibitions cannot be avoided by means of contract, while clause (iv) makes clear on the other hand that contractual relationships will not expand a public accommodation’s obligations under the subparagraph beyond its own clients or customers.

 

As petitioner recognizes, clause (iv) is not literally applicable to Title III’s general rule prohibiting discrimination against disabled individuals.22 Title III’s broad general rule contains no express “clients or customers” limitation, § 12182(a), and § 12182(b)(1)(A)(iv) provides that its limitation is only “[f]or purposes of” the clauses in that separate subparagraph. Nevertheless, petitioner contends that clause (iv)’s restriction of the subparagraph’s coverage to the clients or customers of public accommodations fairly describes the scope of Title III’s protection as a whole.

 

We need not decide whether petitioner’s construction of the statute is correct, because petitioner’s argument falters even on its own terms. If Title III’s protected class were limited to “clients or customers,” it would be entirely appropriate to classify the golfers who pay petitioner $3,000 for the chance to compete in the Q-School and, if successful, in the subsequent tour events, as petitioner’s clients or customers. In our view, petitioner’s tournaments (whether situated at a “golf course” or at a “place of exhibition or entertainment”) simultaneously offer at least two “privileges” to the public–that of watching the golf competition and that of competing in it. Although the latter is more difficult and more expensive to obtain than the former, it is nonetheless a privilege that petitioner makes available to members of the general public. In consideration of the entry fee, any golfer with the requisite letters of recommendation acquires the opportunity to qualify for and compete in petitioner’s tours. Additionally, any golfer who succeeds in the open qualifying rounds for a tournament may play in the event. That petitioner identifies one set of clients or customers that it serves (spectators at tournaments) does not preclude it from having another set (players in tournaments) against whom it may not discriminate. It would be inconsistent with the literal text of the statute as well as its expansive purpose to read Title III’s coverage, even given petitioner’s suggested limitation, any less broadly.23

 

Our conclusion is consistent with case law in the analogous context of Title II of the Civil Rights Act of 1964, 78 Stat. 243, 42 U. S. C. § 2000a et seq. Title II of that Act prohibits public accommodations from discriminating on the basis of race, color, religion, or national origin. § 2000a(a). In Daniel v. Paul, 395 U. S. 298, 306 (1969), applying Title II to the Lake Nixon Club in Little Rock, Arkansas, we held that the definition of a “place of exhibition or entertainment,” as a public accommodation, covered participants “in some sport or activity” as well as “spectators or listeners.” We find equally persuasive two lower court opinions applying Title II specifically to golfers and golf tournaments. In Evans v. Laurel Links, Inc., 261 F. Supp. 474, 477 (ED Va. 1966), a class action brought to require a commercial golf establishment to permit black golfers to play on its course, the District Court held that Title II “is not limited to spectators if the place of exhibition or entertainment provides facilities for the public to participate in the entertainment.”24 And in Wesley v. Savannah, 294 F. Supp. 698 (SD Ga. 1969), the District Court found that a private association violated Title II when it limited entry in a golf tournament on a municipal course to its own members but permitted all (and only) white golfers who paid the membership and entry fees to compete.25 These cases support our conclusion that, as a public accommodation during its tours and qualifying rounds, petitioner may not discriminate against either spectators or competitors on the basis of disability.

 

 

 

 

V

 

 

 

 

As we have noted, 42 U. S. C. § 12182(a) sets forth Title III’s general rule prohibiting public accommodations from discriminating against individuals because of their disabilities. The question whether petitioner has violated that rule depends on a proper construction of the term “discrimination,” which is defined by Title III to include

 

 

“a failure to make reasonable modifications in policies, practices, or procedures, when such modifications are necessary to afford such goods, services, facilities, privileges, advantages, or accommodations to individuals with disabilities, unless the entity can demonstrate that making such modifications would fundamentally alter the nature of such goods, services, facilities, privileges, advantages, or accommodations.” § 12182(b)(2)(A)(ii) (emphasis added).

 

 

Petitioner does not contest that a golf cart is a reasonable modification that is necessary if Martin is to play in its tournaments. Martin’s claim thus differs from one that might be asserted by players with less serious afflictions that make walking the course uncomfortable or difficult, but not beyond their capacity. In such cases, an accommodation might be reasonable but not necessary. In this case, however, the narrow dispute is whether allowing Martin to use a golf cart, despite the walking requirement that applies to the PGA TOUR, the NIKE TOUR, and the third stage of the Q-School, is a modification that would “fundamentally alter the nature” of those events.

 

In theory, a modification of petitioner’s golf tournaments might constitute a fundamental alteration in two different ways. It might alter such an essential aspect of the game of golf that it would be unacceptable even if it affected all competitors equally; changing the diameter of the hole from three to six inches might be such a modification.26 Alternatively, a less significant change that has only a peripheral impact on the game itself might nevertheless give a disabled player, in addition to access to the competition as required by Title III, an advantage over others and, for that reason, fundamentally alter the character of the competition.27 We are not persuaded that a waiver of the walking rule for Martin would work a fundamental alteration in either sense.28

 

As an initial matter, we observe that the use of carts is not itself inconsistent with the fundamental character of the game of golf. From early on, the essence of the game has been shotmaking–using clubs to cause a ball to progress from the teeing ground to a hole some distance away with as few strokes as possible.29 That essential aspect of the game is still reflected in the very first of the Rules of Golf, which declares: “The Game of Golf consists in playing a ball from the teeing ground into the hole by a stroke or successive strokes in accordance with the rules.” Rule 1-1, Rules of Golf, App. 104 (emphasis in original). Over the years, there have been many changes in the players’ equipment, in golf course design, in the Rules of Golf, and in the method of transporting clubs from hole to hole.30 Originally, so few clubs were used that each player could carry them without a bag. Then came golf bags, caddies, carts that were pulled by hand, and eventually motorized carts that carried players as well as clubs. “Golf carts started appearing with increasing regularity on American golf courses in the 1950’s. Today they are everywhere. And they are encouraged. For one thing, they often speed up play, and for another, they are great revenue producers.”31 There is nothing in the Rules of Golf that either forbids the use of carts or penalizes a player for using a cart. That set of rules, as we have observed, is widely accepted in both the amateur and professional golf world as the rules of the game.32 The walking rule that is contained in petitioner’s hard cards, based on an optional condition buried in an appendix to the Rules of Golf,33 is not an essential attribute of the game itself.

 

Indeed, the walking rule is not an indispensable feature of tournament golf either. As already mentioned, petitioner permits golf carts to be used in the SENIOR PGA TOUR, the open qualifying events for petitioner’s tournaments, the first two stages of the Q-School, and, until 1997, the third stage of the Q-School as well. See supra, at 665-667. Moreover, petitioner allows the use of carts during certain tournament rounds in both the PGA TOUR and the NIKE TOUR. See supra, at 667, and n. 6. In addition, although the USGA enforces a walking rule in most of the tournaments that it sponsors, it permits carts in the Senior Amateur and the Senior Women’s Amateur championships.34

 

Petitioner, however, distinguishes the game of golf as it is generally played from the game that it sponsors in the PGA TOUR, NIKE TOUR, and (at least recently) the last stage of the Q-School–golf at the “highest level.” According to petitioner, “[t]he goal of the highest-level competitive athletics is to assess and compare the performance of different competitors, a task that is meaningful only if the competitors are subject to identical substantive rules.”35 The waiver of any possibly “outcome-affecting” rule for a contestant would violate this principle and therefore, in petitioner’s view, fundamentally alter the nature of the highest level athletic event.36 The walking rule is one such rule, petitioner submits, because its purpose is “to inject the element of fatigue into the skill of shot-making,”37 and thus its effect may be the critical loss of a stroke. As a consequence, the reasonable modification Martin seeks would fundamentally alter the nature of petitioner’s highest level tournaments even if he were the only person in the world who has both the talent to compete in those elite events and a disability sufficiently serious that he cannot do so without using a cart.

 

The force of petitioner’s argument is, first of all, mitigated by the fact that golf is a game in which it is impossible to guarantee that all competitors will play under exactly the same conditions or that an individual’s ability will be the sole determinant of the outcome. For example, changes in the weather may produce harder greens and more head winds for the tournament leader than for his closest pursuers. A lucky bounce may save a shot or two.38 Whether such happenstance events are more or less probable than the likelihood that a golfer afflicted with Klippel-Trenaunay-Weber Syndrome would one day qualify for the NIKE TOUR and PGA TOUR, they at least demonstrate that pure chance may have a greater impact on the outcome of elite golf tournaments than the fatigue resulting from the enforcement of the walking rule.

 

Further, the factual basis of petitioner’s argument is undermined by the District Court’s finding that the fatigue from walking during one of petitioner’s 4-day tournaments cannot be deemed significant. The District Court credited the testimony of a professor in physiology and expert on fatigue, who calculated the calories expended in walking a golf course (about five miles) to be approximately 500 calories– “‘nutritionally …less than a Big Mac.’” 994 F. Supp., at 1250. What is more, that energy is expended over a 5-hour period, during which golfers have numerous intervals for rest and refreshment. In fact, the expert concluded, because golf is a low intensity activity, fatigue from the game is primarily a psychological phenomenon in which stress and motivation are the key ingredients. And even under conditions of severe heat and humidity, the critical factor in fatigue is fluid loss rather than exercise from walking.

 

Moreover, when given the option of using a cart, the majority of golfers in petitioner’s tournaments have chosen to walk, often to relieve stress or for other strategic reasons.39 As NIKE TOUR member Eric Johnson testified, walking allows him to keep in rhythm, stay warmer when it is chilly, and develop a better sense of the elements and the course than riding a cart.40

 

Even if we accept the factual predicate for petitioner’s argument–that the walking rule is “outcome affecting” because fatigue may adversely affect performance–its legal position is fatally flawed. Petitioner’s refusal to consider Martin’s personal circumstances in deciding whether to accommodate his disability runs counter to the clear language and purpose of the ADA. As previously stated, the ADA was enacted to eliminate discrimination against “individuals” with disabilities, 42 U. S. C. § 12101(b)(1), and to that end Title III of the Act requires without exception that any “policies, practices, or procedures” of a public accommodation be reasonably modified for disabled “individuals” as necessary to afford access unless doing so would fundamentally alter what is offered, § 12182(b)(2)(A)(ii). To comply with this command, an individualized inquiry must be made to determine whether a specific modification for a particular person’s disability would be reasonable under the circumstances as well as necessary for that person, and yet at the same time not work a fundamental alteration. See S. Rep. No. 101-116, at 61; H. R. Rep. No. 101-485, pt. 2, at 102 (public accommodations “are required to make decisions based on facts applicable to individuals”). Cf. Sutton v. United Air Lines, Inc., 527 U. S. 471, 483 (1999) (“[W]hether a person has a disability under the ADA is an individualized inquiry”).

 

To be sure, the waiver of an essential rule of competition for anyone would fundamentally alter the nature of petitioner’s tournaments. As we have demonstrated, however, the walking rule is at best peripheral to the nature of petitioner’s athletic events, and thus it might be waived in individual cases without working a fundamental alteration. Therefore, petitioner’s claim that all the substantive rules for its “highest-level” competitions are sacrosanct and cannot be modified under any circumstances is effectively a contention that it is exempt from Title III’s reasonable modification requirement. But that provision carves out no exemption for elite athletics, and given Title III’s coverage not only of places of “exhibition or entertainment” but also of “golf course[s],” 42 U. S. C. §§ 12181(7)(C), (L), its application to petitioner’s tournaments cannot be said to be unintended or unexpected, see §§ 12101(a)(1), (5). Even if it were, “the fact that a statute can be applied in situations not expressly anticipated by Congress does not demonstrate ambiguity. It demonstrates breadth.” Pennsylvania Dept. of Corrections v. Yeskey, 524 U. S., at 212 (internal quotation marks omitted).41

 

Under the ADA’s basic requirement that the need of a disabled person be evaluated on an individual basis, we have no doubt that allowing Martin to use a golf cart would not fundamentally alter the nature of petitioner’s tournaments. As we have discussed, the purpose of the walking rule is to subject players to fatigue, which in turn may influence the outcome of tournaments. Even if the rule does serve that purpose, it is an uncontested finding of the District Court that Martin “easily endures greater fatigue even with a cart than his able-bodied competitors do by walking.” 994 F. Supp., at 1252. The purpose of the walking rule is therefore not compromised in the slightest by allowing Martin to use a cart. A modification that provides an exception to a peripheral tournament rule without impairing its purpose cannot be said to “fundamentally alter” the tournament. What it can be said to do, on the other hand, is to allow Martin the chance to qualify for, and compete in, the athletic events petitioner offers to those members of the public who have the skill and desire to enter. That is exactly what the ADA requires.42 As a result, Martin’s request for a waiver of the walking rule should have been granted.

 

The ADA admittedly imposes some administrative burdens on the operators of places of public accommodation that could be avoided by strictly adhering to general rules and policies that are entirely fair with respect to the able-bodied but that may indiscriminately preclude access by qualified persons with disabilities.43 But surely, in a case of this kind, Congress intended that an entity like the PGA not only give individualized attention to the handful of requests that it might receive from talented but disabled athletes for a modification or waiver of a rule to allow them access to the competition, but also carefully weigh the purpose, as well as the letter, of the rule before determining that no accommodation would be tolerable.

 

The judgment of the Court of Appeals is affirmed.

 

It is so ordered.

 

 

 

Justice Scalia, with whom Justice Thomas joins, dissenting.

 

 

 

In my view today’s opinion exercises a benevolent compassion that the law does not place it within our power to impose. The judgment distorts the text of Title III, the structure of the ADA, and common sense. I respectfully dissent.

 

 

 

 

I

 

 

 

 

The Court holds that a professional sport is a place of public accommodation and that respondent is a “custome[r]” of “competition” when he practices his profession. Ante, at 679-680. It finds, ante, at 680, that this strange conclusion is compelled by the “literal text” of Title III of the Americans with Disabilities Act of 1990 (ADA), 42 U. S. C. § 12101 et seq., by the “expansive purpose” of the ADA, and by the fact that Title II of the Civil Rights Act of 1964, 42 U. S. C. § 2000a(a), has been applied to an amusement park and public golf courses. I disagree.

 

The ADA has three separate titles: Title I covers employment discrimination, Title II covers discrimination by government entities, and Title III covers discrimination by places of public accommodation. Title II is irrelevant to this case. Title I protects only “employees” of employers who have 15 or more employees, §§ 12112(a), 12111(5)(A). It does not protect independent contractors. See, e. g., Birchem v. Knights of Columbus, 116 F. 3d 310, 312-313 (CA8 1997); cf. Nationwide Mut. Ins. Co. v. Darden, 503 U. S. 318, 322– 323 (1992). Respondent claimed employment discrimination under Title I, but the District Court found him to be an independent contractor rather than an employee.

 

Respondent also claimed protection under § 12182 of Title III. That section applies only to particular places and persons. The place must be a “place of public accommodation,” and the person must be an “individual” seeking “enjoyment of the goods, services, facilities, privileges, advantages, or accommodations” of the covered place. § 12182(a). Of course a court indiscriminately invoking the “sweeping” and “expansive” purposes of the ADA, ante, at 675, 680, could argue that when a place of public accommodation denied any “individual,” on the basis of his disability, anything that might be called a “privileg[e],” the individual has a valid Title III claim. Cf. ante, at 677. On such an interpretation, the employees and independent contractors of every place of public accommodation come within Title III: The employee enjoys the “privilege” of employment, the contractor the “privilege” of the contract.

 

For many reasons, Title III will not bear such an interpretation. The provision of Title III at issue here (§ 12182, its principal provision) is a public-accommodation law, and it is the traditional understanding of public-accommodation laws that they provide rights for customers. “At common law, innkeepers, smiths, and others who made profession of a public employment, were prohibited from refusing, without good reason, to serve a customer.” Hurley v. Irish-American Gay, Lesbian and Bisexual Group of Boston, Inc., 515 U. S. 557, 571 (1995) (internal quotation marks omitted). See also Heart of Atlanta Motel, Inc. v. United States, 379 U. S. 241 (1964). This understanding is clearly reflected in the text of Title III itself. Section 12181(7) lists 12 specific types of entities that qualify as “public accommodations,” with a follow-on expansion that makes it clear what the “enjoyment of the goods, services, etc.,” of those entities consists of–and it plainly envisions that the person “enjoying” the “public accommodation” will be a customer. For example, Title III is said to cover an “auditorium” or “other place of public gathering,” § 12181(7)(D). Thus, “gathering” is the distinctive enjoyment derived from an auditorium; the persons “gathering” at an auditorium are presumably covered by Title III, but those contracting to clean the auditorium are not. Title III is said to cover a “zoo” or “other place of recreation,” § 12181(7)(I). The persons “recreat[ing]” at a “zoo” are presumably covered, but the animal handlers bringing in the latest panda are not. The one place where Title III specifically addresses discrimination by places of public accommodation through “contractual” arrangements, it makes clear that discrimination against the other party to the contract is not covered, but only discrimination against “clients or customers of the covered public accommodation that enters into the contractual, licensing or other arrangement.” § 12182(b)(1)(A)(iv). And finally, the regulations promulgated by the Department of Justice reinforce the conclusion that Title III’s protections extend only to customers. “The purpose of the ADA’s public accommodations requirements,” they say, “is to ensure accessibility to the goods offered by a public accommodation.” 28 CFR, ch. 1, pt. 36, App. B, p. 650 (2000). Surely this has nothing to do with employees and independent contractors.

 

If there were any doubt left that § 12182 covers only clients and customers of places of public accommodation, it is eliminated by the fact that a contrary interpretation would make a muddle of the ADA as a whole. The words of Title III must be read “in their context and with a view to their place in the overall statutory scheme.” Davis v. Michigan Dept. of Treasury, 489 U. S. 803, 809 (1989). Congress expressly excluded employers of fewer than 15 employees from Title I. The mom-and-pop grocery store or laundromat need not worry about altering the nonpublic areas of its place of business to accommodate handicapped employees–or about the litigation that failure to do so will invite. Similarly, since independent contractors are not covered by Title I, the small business (or the large one, for that matter) need not worry about making special accommodations for the painters, electricians, and other independent workers whose services are contracted for from time to time. It is an entirely unreasonable interpretation of the statute to say that these exemptions so carefully crafted in Title I are entirely eliminated by Title III (for the many businesses that are places of public accommodation) because employees and independent contractors “enjoy” the employment and contracting that such places provide. The only distinctive feature of places of public accommodation is that they accommodate the public, and Congress could have no conceivable reason for according the employees and independent contractors of such businesses protections that employees and independent contractors of other businesses do not enjoy.

 

The United States apparently agrees that employee claims are not cognizable under Title III, see Brief for United States as Amicus Curiae 18-19, n. 17, but despite the implications of its own regulations, see 28 CFR, ch. 1, pt. 36, App. B, at 650, appears to believe (though it does not explicitly state) that claims of independent contractors are cognizable. In a discussion littered with entirely vague statements from the legislative history, cf. ante, at 674-675, the United States argues that Congress presumably wanted independent contractors with private entities covered under Title III because independent contractors with governmental entities are covered by Title II, see Brief for United States as Amicus Curiae 18, and n. 17–a line of reasoning that does not commend itself to the untutored intellect. But since the United States does not provide (and I cannot conceive of) any possible construction of the terms of Title III that will exclude employees while simultaneously covering independent contractors, its concession regarding employees effectively concedes independent contractors as well. Title III applies only to customers.

 

The Court, for its part, assumes that conclusion for the sake of argument, ante, at 679-680, but pronounces respondent to be a “customer” of the PGA TOUR or of the golf courses on which it is played. That seems to me quite incredible. The PGA TOUR is a professional sporting event, staged for the entertainment of a live and TV audience, the receipts from whom (the TV audience’s admission price is paid by advertisers) pay the expenses of the tour, including the cash prizes for the winning golfers. The professional golfers on the tour are no more “enjoying” (the statutory term) the entertainment that the tour provides, or the facilities of the golf courses on which it is held, than professional baseball players “enjoy” the baseball games in which they play or the facilities of Yankee Stadium. To be sure, professional ballplayers participate in the games, and use the ballfields, but no one in his right mind would think that they are customers of the American League or of Yankee Stadium. They are themselves the entertainment that the customers pay to watch. And professional golfers are no different. It makes not a bit of difference, insofar as their “customer” status is concerned, that the remuneration for their performance (unlike most of the remuneration for ballplayers) is not fixed but contingent–viz., the purses for the winners in the various events, and the compensation from product endorsements that consistent winners are assured. The compensation of many independent contractors is contingent upon their success–real estate brokers, for example, or insurance salesmen.

 

As the Court points out, the ADA specifically identifies golf courses as one of the covered places of public accommodation. See § 12181(7)(L) (“a gymnasium, health spa, bowling alley, golf course, or other place of exercise or recreation”); and the distinctive “goo[d], servic[e], facilit[y], privileg[e], advantag[e], or accommodatio[n]” identified by that provision as distinctive to that category of place of public accommodation is “exercise or recreation.” Respondent did not seek to “exercise” or “recreate” at the PGA TOUR events; he sought to make money (which is why he is called a professional golfer). He was not a customer buying recreation or entertainment; he was a professional athlete selling it. That is the reason (among others) the Court’s reliance upon Civil Rights Act cases like Daniel v. Paul, 395 U. S. 298 (1969), see ante, at 681, is misplaced. A professional golfer’s practicing his profession is not comparable to John Q. Public’s frequenting “a 232-acre amusement area with swimming, boating, sun bathing, picnicking, miniature golf, dancing facilities, and a snack bar.” Daniel, supra, at 301.

 

The Court relies heavily upon the Q-School. It says that petitioner offers the golfing public the “privilege” of “competing in the Q-School and playing in the tours; indeed, the former is a privilege for which thousands of individuals from the general public pay, and the latter is one for which they vie.” Ante, at 677. But the Q-School is no more a “privilege” offered for the general public’s “enjoyment” than is the California Bar Exam.44 It is a competition for entry into the PGA TOUR–an open tryout, no different in principle from open casting for a movie or stage production, or walk-on tryouts for other professional sports, such as baseball. See, e. g., Amateurs Join Pros for New Season of HBO’s “Sopranos,” Detroit News, Dec. 22, 2000, p. 2 (20,000 attend open casting for “The Sopranos”); Bill Zack, Atlanta Braves, Sporting News, Feb. 6, 1995 (1,300 would-be players attended an open tryout for the Atlanta Braves). It may well be that some amateur golfers enjoy trying to make the grade, just as some amateur actors may enjoy auditions, and amateur baseball players may enjoy open tryouts (I hesitate to say that amateur lawyers may enjoy taking the California Bar Exam). But the purpose of holding those tryouts is not to provide entertainment; it is to hire. At bottom, open tryouts for performances to be held at a place of public accommodation are no different from open bidding on contracts to cut the grass at a place of public accommodation, or open applications for any job at a place of public accommodation. Those bidding, those applying–and those trying out–are not converted into customers. By the Court’s reasoning, a business exists not only to sell goods and services to the public, but to provide the “privilege” of employment to the public; wherefore it follows, like night the day, that everyone who seeks a job is a customer.45

 

 

 

 

II

 

 

 

 

Having erroneously held that Title III applies to the “customers” of professional golf who consist of its practitioners, the Court then erroneously answers–or to be accurate simply ignores–a second question. The ADA requires covered businesses to make such reasonable modifications of “policies, practices, or procedures” as are necessary to “afford” goods, services, and privileges to individuals with disabilities; but it explicitly does not require “modifications [that] would fundamentally alter the nature” of the goods, services, and privileges. § 12182(b)(2)(A)(ii). In other words, disabled individuals must be given access to the same goods, services, and privileges that others enjoy. The regulations state that Title III “does not require a public accommodation to alter its inventory to include accessible or special goods with accessibility features that are designed for, or facilitate use by, individuals with disabilities.” 28 CFR § 36.307 (2000); see also 28 CFR, ch. 1, pt. 36, App. B, at 650. As one Court of Appeals has explained:

 

 

“The common sense of the statute is that the content of the goods or services offered by a place of public accommodation is not regulated. A camera store may not refuse to sell cameras to a disabled person, but it is not required to stock cameras specially designed for such persons. Had Congress purposed to impose so enormous a burden on the retail sector of the economy and so vast a supervisory responsibility on the federal courts, we think it would have made its intention clearer and would at least have imposed some standards. It is hardly a feasible judicial function to decide whether shoestores should sell single shoes to one-legged persons and if so at what price, or how many Braille books the Borders or Barnes and Noble bookstore chains should stock in each of their stores.” Doe v. Mutual of Omaha Ins. Co., 179 F. 3d 557, 560 (CA7 1999).

 

 

Since this is so, even if respondent here is a consumer of the “privilege” of the PGA TOUR competition, see ante, at 677, I see no basis for considering whether the rules of that competition must be altered. It is as irrelevant to the PGA TOUR’s compliance with the statute whether walking is essential to the game of golf as it is to the shoe store’s compliance whether “pairness” is essential to the nature of shoes. If a shoe store wishes to sell shoes only in pairs it may; and if a golf tour (or a golf course) wishes to provide only walkaround golf, it may. The PGA TOUR cannot deny respondent access to that game because of his disability, but it need not provide him a game different (whether in its essentials or in its details) from that offered to everyone else.

 

Since it has held (or assumed) professional golfers to be customers “enjoying” the “privilege” that consists of PGA TOUR golf; and since it inexplicably regards the rules of PGA TOUR golf as merely “policies, practices, or procedures” by which access to PGA TOUR golf is provided, the Court must then confront the question whether respondent’s requested modification of the supposed policy, practice, or procedure of walking would “fundamentally alter the nature” of the PGA TOUR game, § 12182(b)(2)(A)(ii). The Court attacks this “fundamental alteration” analysis by asking two questions: first, whether the “essence” or an “essential aspect” of the sport of golf has been altered; and second, whether the change, even if not essential to the game, would give the disabled player an advantage over others and thereby “fundamentally alter the character of the competition.” Ante, at 683. It answers no to both.

 

Before considering the Court’s answer to the first question, it is worth pointing out that the assumption which underlies that question is false. Nowhere is it writ that PGA TOUR golf must be classic “essential” golf. Why cannot the PGA TOUR, if it wishes, promote a new game, with distinctive rules (much as the American League promotes a game of baseball in which the pitcher’s turn at the plate can be taken by a “designated hitter”)? If members of the public do not like the new rules–if they feel that these rules do not truly test the individual’s skill at “real golf” (or the team’s skill at “real baseball”) they can withdraw their patronage. But the rules are the rules. They are (as in all games) entirely arbitrary, and there is no basis on which anyone–not even the Supreme Court of the United States–can pronounce one or another of them to be “nonessential” if the rulemaker (here the PGA TOUR) deems it to be essential.

 

If one assumes, however, that the PGA TOUR has some legal obligation to play classic, Platonic golf–and if one assumes the correctness of all the other wrong turns the Court has made to get to this point–then we Justices must confront what is indeed an awesome responsibility. It has been rendered the solemn duty of the Supreme Court of the United States, laid upon it by Congress in pursuance of the Federal Government’s power “[t]o regulate Commerce with foreign Nations, and among the several States,” U. S. Const., Art. I,§ 8, cl. 3, to decide What Is Golf. I am sure that the Framers of the Constitution, aware of the 1457 edict of King James II of Scotland prohibiting golf because it interfered with the practice of archery, fully expected that sooner or later the paths of golf and government, the law and the links, would once again cross, and that the judges of this august Court would some day have to wrestle with that age-old jurisprudential question, for which their years of study in the law have so well prepared them: Is someone riding around a golf course from shot to shot really a golfer? The answer, we learn, is yes. The Court ultimately concludes, and it will henceforth be the Law of the Land, that walking is not a “fundamental” aspect of golf.

 

Either out of humility or out of self-respect (one or the other) the Court should decline to answer this incredibly difficult and incredibly silly question. To say that something is “essential” is ordinarily to say that it is necessary to the achievement of a certain object. But since it is the very nature of a game to have no object except amusement (that is what distinguishes games from productive activity), it is quite impossible to say that any of a game’s arbitrary rules is “essential.” Eighteen-hole golf courses, 10-foot-high basketball hoops, 90-foot baselines, 100-yard football fields–all are arbitrary and none is essential. The only support for any of them is tradition and (in more modern times) insistence by what has come to be regarded as the ruling body of the sport–both of which factors support the PGA TOUR’s position in the present case. (Many, indeed, consider walking to be the central feature of the game of golf–hence Mark Twain’s classic criticism of the sport: “a good walk spoiled.”) I suppose there is some point at which the rules of a wellknown game are changed to such a degree that no reasonable person would call it the same game. If the PGA TOUR competitors were required to dribble a large, inflated ball and put it through a round hoop, the game could no longer reasonably be called golf. But this criterion–destroying recognizability as the same generic game–is surely not the test of “essentialness” or “fundamentalness” that the Court applies, since it apparently thinks that merely changing the diameter of the cup might “fundamentally alter” the game of golf, ante, at 682.

 

Having concluded that dispensing with the walking rule would not violate federal-Platonic “golf” (and, implicitly, that it is federal-Platonic golf, and no other, that the PGA TOUR can insist upon), the Court moves on to the second part of its test: the competitive effects of waiving this nonessential rule. In this part of its analysis, the Court first finds that the effects of the change are “mitigated” by the fact that in the game of golf weather, a “lucky bounce,” and “pure chance” provide different conditions for each competitor and individual ability may not “be the sole determinant of the outcome.” Ante, at 687. I guess that is why those who follow professional golfing consider Jack Nicklaus the luckiest golfer of all time, only to be challenged of late by the phenomenal luck of Tiger Woods. The Court’s empiricism is unpersuasive. “Pure chance” is randomly distributed among the players, but allowing respondent to use a cart gives him a “lucky” break every time he plays. Pure chance also only matters at the margin–a stroke here or there; the cart substantially improves this respondent’s competitive prospects beyond a couple of strokes. But even granting that there are significant nonhuman variables affecting competition, that fact does not justify adding another variable that always favors one player.

 

In an apparent effort to make its opinion as narrow as possible, the Court relies upon the District Court’s finding that even with a cart, respondent will be at least as fatigued as everyone else. Ante, at 690. This, the Court says, proves that competition will not be affected. Far from thinking that reliance on this finding cabins the effect of today’s opinion, I think it will prove to be its most expansive and destructive feature. Because step one of the Court’s two-part inquiry into whether a requested change in a sport will “fundamentally alter [its] nature,” § 12182(b)(2)(A)(ii), consists of an utterly unprincipled ontology of sports (pursuant to which the Court is not even sure whether golf’s “essence” requires a 3-inch hole), there is every reason to think that in future cases involving requests for special treatment by would-be athletes the second step of the analysis will be determinative. In resolving that second step–determining whether waiver of the “nonessential” rule will have an impermissible “competitive effect”–by measuring the athletic capacity of the requesting individual, and asking whether the special dispensation would do no more than place him on a par (so to speak) with other competitors, the Court guarantees that future cases of this sort will have to be decided on the basis of individualized factual findings. Which means that future cases of this sort will be numerous, and a rich source of lucrative litigation. One can envision the parents of a Little League player with attention deficit disorder trying to convince a judge that their son’s disability makes it at least 25% more difficult to hit a pitched ball. (If they are successful, the only thing that could prevent a court order giving the kid four strikes would be a judicial determination that, in baseball, three strikes are metaphysically necessary, which is quite absurd.)

 

The statute, of course, provides no basis for this individualized analysis that is the Court’s last step on a long and misguided journey. The statute seeks to assure that a disabled person’s disability will not deny him equal access to (among other things) competitive sporting events–not that his disability will not deny him an equal chance to win competitive sporting events. The latter is quite impossible, since the very nature of competitive sport is the measurement, by uniform rules, of unevenly distributed excellence. This unequal distribution is precisely what determines the winners and losers–and artificially to “even out” that distribution, by giving one or another player exemption from a rule that emphasizes his particular weakness, is to destroy the game. That is why the “handicaps” that are customary in social games of golf–which, by adding strokes to the scores of the good players and subtracting them from scores of the bad ones, “even out” the varying abilities–are not used in professional golf. In the Court’s world, there is one set of rules that is “fair with respect to the able-bodied” but “individualized” rules, mandated by the ADA, for “talented but disabled athletes.” Ante, at 691. The ADA mandates no such ridiculous thing. Agility, strength, speed, balance, quickness of mind, steadiness of nerves, intensity of concentration–these talents are not evenly distributed. No wildeyed dreamer has ever suggested that the managing bodies of the competitive sports that test precisely these qualities should try to take account of the uneven distribution of Godgiven gifts when writing and enforcing the rules of competition. And I have no doubt Congress did not authorize misty-eyed judicial supervision of such a revolution.

 

 

 

 

* * *

 

 

 

 

My belief that today’s judgment is clearly in error should not be mistaken for a belief that the PGA TOUR clearly ought not allow respondent to use a golf cart. That is a close question, on which even those who compete in the PGA TOUR are apparently divided; but it is a different question from the one before the Court. Just as it is a different question whether the Little League ought to give disabled youngsters a fourth strike, or some other waiver from the rules that makes up for their disabilities. In both cases, whether they ought to do so depends upon (1) how central to the game that they have organized (and over whose rules they are the master) they deem the waived provision to be, and (2) how competitive–how strict a test of raw athletic ability in all aspects of the competition–they want their game to be. But whether Congress has said they must do so depends upon the answers to the legal questions I have discussed above–not upon what this Court sententiously decrees to be “‘decent, tolerant, [and] progressive,’ ” ante, at 675 (quoting Board of Trustees of Univ. of Ala. v. Garrett, 531 U. S. 356, 375 (2001) (Kennedy, J., concurring)).

 

And it should not be assumed that today’s decent, tolerant, and progressive judgment will, in the long run, accrue to the benefit of sports competitors with disabilities. Now that it is clear courts will review the rules of sports for “fundamentalness,” organizations that value their autonomy have every incentive to defend vigorously the necessity of every regulation. They may still be second-guessed in the end as to the Platonic requirements of the sport, but they will assuredly lose if they have at all wavered in their enforcement. The lesson the PGA TOUR and other sports organizations should take from this case is to make sure that the same written rules are set forth for all levels of play, and never voluntarily to grant any modifications. The second lesson is to end open tryouts. I doubt that, in the long run, even disabled athletes will be well served by these incentives that the Court has created.

 

Complaints about this case are not “properly directed to Congress,” ante, at 689, n. 51. They are properly directed to this Court’s Kafkaesque determination that professional sports organizations, and the fields they rent for their exhibitions, are “places of public accommodation” to the competing athletes, and the athletes themselves “customers” of the organization that pays them; its Alice in Wonderland determination that there are such things as judicially determinable “essential” and “nonessential” rules of a made-up game; and its Animal Farm determination that fairness and the ADA mean that everyone gets to play by individualized rules which will assure that no one’s lack of ability (or at least no one’s lack of ability so pronounced that it amounts to a disability) will be a handicap. The year was 2001, and “everybody was finally equal.” K. Vonnegut, Harrison Bergeron, in Animal Farm and Related Readings 129 (1997).

 


    1. Instead, Appendix I to the Rules of Golf lists a number of “optional” conditions, among them one related to transportation: “If it is desired to require players to walk in a competition, the following condition is suggested: ‘Players shall walk at all times during a stipulated round.’” App. 125.

 

    1. The PGA TOUR hard card provides: “Players shall walk at all times during a stipulated round unless permitted to ride by the PGA TOUR Rules Committee.” Id., at 127. The NIKE TOUR hard card similarly requires walking unless otherwise permitted. Id., at 129. Additionally, as noted, golf carts have not been permitted during the third stage of the Q-School since 1997. Petitioner added this recent prohibition in order to “approximat[e] a PGA TOUR event as closely as possible.” Id., at 152.

 

    1. 994 F. Supp. 1242, 1251 (Ore. 1998).

 

    1. Title 42 U. S. C. § 12102 provides, in part:

       

       

      The term ‘disability’ means, with respect to an individual–

       

       

      (A) a physical or mental impairment that substantially limits one or more of the major life activities of such individual … .

       

       

 

    1. Before then, even when Martin was in extreme pain, and was offered a cart, he declined. Tr. 564-565.

 

    1. When asked about the other teams’ reaction to Martin’s use of a cart, the Stanford coach testified:

       

      “Q. Was there any complaint ever made to you by the coaches when he was allowed a cart that that gave a competitive advantage over the–

       

      “A. Any complaints? No sir, there were exactly–exactly the opposite. Everybody recognized Casey for the person he was, and what he was doing with his life, and every coach, to my knowledge, and every player wanted Casey in the tournament and they welcomed him there.

       

      “Q. Did anyone contend that that constituted an alteration of the competition to the extent that it didn’t constitute the game to your level, the college level?

       

      “A. Not at all, sir.” App. 208.

 

    1. “Q.And fatigue is one of the factors that can cause a golfer at the PGA Tour level to lose one stroke or more?

       

      “A. Oh, it is.And it has happened.

       

      “Q. And can one stroke be the difference between winning and not winning a tournament at the PGA Tour level?

       

      “A. As I said, I’ve lost a few national opens by one stroke.” App. 177.

 

    1. “Q.Mr. Nicklaus, what is your understanding of the reason why in these competitive events …that competitors are required to walk the course?

       

      “A. Well, in my opinion, physical fitness and fatigue are part of the game of golf.” Id., at 190.

 

    1. “Q.So are you telling the court that this fatigue factor tends to accumulate over the course of the four days of the tournament?

       

      “A. Oh definitely. There’s no doubt.

       

      … . .

       

      “Q. Does this fatigue factor that you’ve talked about, Mr. Venturi, affect the manner in which you–you perform as a professional out on the golf course?

       

      “A. Oh, there’s no doubt, again, but that, that fatigue does play a big part. It will influence your game. It will influence your shot-making. It will influence your decisions.” Id., at 236-237.

 

    1. “Q.Based on your experience, do you believe that it would fundamentally alter the nature of the competition on the PGA Tour and the Nike Tour if competitors in those events were permitted to use golf carts?

       

      “A. Yes, absolutely.

       

      “Q. Why do you say so, sir?

       

      “A. It would–it would take away the fatigue factor in many ways. It would–it would change the game.

       

      … . .

       

      “Q. Now, when you say that the use of carts takes away the fatigue factor, it would be an aid, et cetera, again, as I understand it, you are not testifying now about the plaintiff. You are just talking in general terms?

       

      … . .

       

      “A. Yes, sir.” Id., at 238. See also id., at 177-178 (Palmer); id., at 191 (Nicklaus).

 

    1. 42 U. S. C. §§ 12111-12117.

 

    1. §§ 12131-12165.

 

    1. §§ 12181-12189.

 

    1. “(A)an inn, hotel, motel, or other place of lodging, except for an establishment located within a building that contains not more than five rooms for rent or hire and that is actually occupied by the proprietor of such establishment as the residence of such proprietor;

       

      “(B) a restaurant, bar, or other establishment serving food or drink;

       

      “(C) a motion picture house, theater,concert hall,stadium, or other place of exhibition or entertainment;

       

      “(D) an auditorium,convention center, lecture hall, or other place of public gathering;

       

      “(E) a bakery, grocery store, clothing store, hardware store, shopping center, or other sales or rental establishment;

       

      “(F) a laundromat, dry-cleaner, bank, barber shop, beauty shop, travel service,shoe repair service,funeral parlor,gas station,office of anaccountant or lawyer,pharmacy, insurance office, professional office of a health care provider, hospital, or other service establishment;

       

      “(G) a terminal, depot, or other station used for specified public transportation;

       

      “(H) a museum, library, gallery, or other place of display or collection;

       

      “(I)a park, zoo, amusement park, or other place of recreation;

       

      “(J) a nursery, elementary, secondary, undergraduate, or postgraduate private school, or other place of education;

       

      “(K) a day care center, seniorcitizencenter, homeless shelter, food bank, adoption agency, or other social service center establishment; and

       

      “(L) a gymnasium, health spa, bowling alley, golf course, or other place of exercise or recreation.”§ 12181(7) (emphasis added).

 

    1. S. Rep. No. 101-116, p. 59 (1989); H. R. Rep. No. 101-485, pt. 2, p. 100 (1990).

 

    1. Reply Brief for Petitioner 1-2.

 

    1. Martin complains that petitioner’s failure to make this exact argument below precludes its assertion here.However, the Title III coverage issue was raised in the lower courts, petitioner advanced this particular argument in support of its position on the issue in its petition for certiorari, and the argument was fully briefed on the merits by both parties.Given the importance of the issue, we exercise our discretion to consider it.See Harris Trust and Sav. Bank v. Salomon Smith Barney Inc., 530 U. S. 238, 245-246, n. 2 (2000); Carlson v. Green, 446 U. S. 14, 17, n. 2 (1980).

 

    1. Brief for Petitioner 10, 11.

 

    1. Id., at 19 (quoting 42 U. S. C. § 12182(b)(1)(A)(iv)).

 

    1. Brief for Petitioner 15; see also id., at 16 (Martin’s claim “is nothing more than a straightforward discrimination-in-the-workplacecomplaint”).

 

    1. Clause (i) prohibits the denial of participation, clause (ii) participation in unequal benefits, and clause (iii) the provision of separate benefits.

 

    1. Brief for Petitioner 20 (clause (iv) “applies directly just to subsection 12182(b)”); Reply Brief for Petitioner 4, n. 1 (clause (iv) “does not apply directly to the general provision prohibiting discrimination”).

 

    1. Contrary to the dissent’s suggestion, our view of the Q-School does not make “everyone who seeks a job” at a public accommodation, through “an open tryout” or otherwise, “a customer.” Post, at 697 (opinion of Scalia, J.). Unlike those who successfully apply for a job at a place of public accommodation, or those who successfully bid for a contract, the golfers who qualify for petitioner’s tours play at their own pleasure (perhaps, but not necessarily, for prize money), and although they commit to playing in at least 15 tournaments, they are not bound by any obligations typically associated with employment. See, e. g., App. 260 (trial testimony of PGA commissioner Timothy Finchem) (petitioner lacks control over when and where tour members compete, and over their manner of performance outside the rules of competition). Furthermore, unlike athletes in “other professional sports, such as baseball,” post, at 697, in which players are employed by their clubs, the golfers on tour are not employed by petitioner or any related organizations. The record does not support the proposition that the purpose of the Q-School “is to hire,” ibid., rather than to narrow the field of participants in the sporting events that petitioner sponsors at places of public accommodation.

 

    1. Title II of the Civil Rights Act of 1964 includes in its definition of “public accommodation” a “place of exhibition or entertainment” but does not specifically list a “golf course” as an example.See 42 U. S. C. § 2000a(b).

 

    1. Under petitioner’s theory, Title II would not preclude it from discriminating against golfers on racial grounds.App. 197; Tr. of Oral Arg. 11-12.

 

    1. Cf. post, at 701 (Scalia, J., dissenting) (“I suppose there is some point at which the rules of a well-known game are changed to such a degree that no reasonable person would call it the same game”).

 

    1. Accord, post, at 703 (Scalia, J., dissenting) (“The statute seeks to assure that a disabled person’s disability will not deny him equal access to (among other things) competitive sporting events–not that his disability will not deny him an equal chance to win competitive sporting events”).

 

    1. As we have noted, the statute contemplates three inquiries: whether the requested modification is “reasonable,” whether it is “necessary” for the disabled individual, and whether it would “fundamentally alter the nature of” the competition. 42 U. S. C. § 12182(b)(2)(A)(ii). Whether one question should be decided before the others likely will vary from case to case, for in logic there seems to be no necessary priority among the three. In routine cases, the fundamental alteration inquiry may end with the question whether a rule is essential. Alternatively, the specifics of the claimed disability might be examined within the context of what is a reasonable or necessary modification. Given the concession by petitioner that the modification sought is reasonable and necessary, and given petitioner’s reliance on the fundamental alteration provision, we have no occasion to consider the alternatives in this case.

 

    1. Golf is an ancient game, tracing its ancestry to Scotland, and played by such no tables as Mary Queen of Scots and her son James. That shotmaking has been the essence of golf since early in its history is reflected in the first recorded rules of golf, published in 1744 for a tournament on the Leith Links in Edinburgh:

       

      “Articles & Laws in Playing at Golf

       

      “1. You must Tee your Ball, within a Club’s length of the [previous] Hole.

       

      “2. Your Tee must be upon the Ground.

       

      “3. You are not to change the Ball which you Strike off the Tee.

       

      “4. You are not to remove, Stones, Bones or any Break Club for the sake of playing your Ball, Except upon the fair Green/& that only/ within a Club’s length of your Ball.

       

      “5. If your Ball comes among Water, or any Watery Filth, you are at liberty to take out your Ball & bringing it behind the hazard and Teeing it, you may play it with any Club and allow your Adversary a Stroke for so getting out your Ball.

       

      “6. If your Balls be found anywhere touching one another, You are to lift the first Ball, till you play the last.

       

      “7. At Holling, you are to play your Ball honestly for the Hole, and, not to play upon your Adversary’s Ball, not lying in your way to the Hole. “8. If you should lose your Ball, by its being taken up, or any other way, you are to go back to the Spot, where you struck last & drop another Ball, And allow your Adversary a Stroke for the misfortune.

       

      “9. No man at Holling his Ball, is to be allowed, to mark his way to the Hole with his Club or, any thing else.

       

      “10. If a Ball be stopp’d by any person, Horse, Dog, or any thing else, The Ball so stop’d must be play’d where it lyes.

       

      “11. If you draw your Club, in order to Strike & proceed so far in the Stroke, as to be bringing down your Club; If then, your Club shall break, in, any way, it is to be Accounted a Stroke.

       

      “12. He, whose Ball lyes farthest from the Hole is obliged to play first.

       

      “13. Neither Trench, Ditch, or Dyke, made for the preservation of the Links, nor the Scholar’s Holes or the Soldier’s Lines, Shall be accounted a Hazard; But the Ball is to be taken out/Teed/and play’d with any Iron Club.” K. Chapman, Rules of the Green 14-15 (1997).

 

    1. See generally M. Campbell, The Random House International Encyclopedia of Golf 9-57 (1991); Golf Magazine’s Encyclopedia of Golf 1-17 (2d ed. 1993).

 

    1. Olinger v. United States Golf Assn., 205 F. 3d 1001, 1003 (CA7 2000).

 

    1. On this point, the testimony of the immediate past president of the USGA (and one of petitioner’s witnesses at trial) is illuminating:

       

      “Tell the court, if you would, Ms. Bell, who it is that plays under these Rules of Golf … ?

       

      “A. Well, these are the rules of the game, so all golfers. These are for all people who play the game.

       

      “Q. So the two amateurs that go out on the weekend to play golf together would–would play by the Rules of Golf?

       

      “A. We certainly hope so.

       

      “Q. Or a tournament that is conducted at a private country club for its members, is it your understanding that that would typically be conducted under the Rules of Golf?

       

      “A. Well, that’s–that’s right. If you want to play golf, you need to play by these rules.” App. 239.

 

    1. See n. 3, supra.

 

    1. Furthermore, the USGA’s handicap system, used by over 4 million amateur golfers playing on courses rated by the USGA, does not consider whether a player walks or rides in a cart, or whether she uses a caddy or carries her own clubs. Rather, a player’s handicap is determined by a formula that takes into account the average score in the 10 best of her 20 most recent rounds, the difficulty of the different courses played, and whether or not a round was a “tournament” event.

 

    1. Brief for Petitioner 13.

 

    1. Id., at 37.

 

    1. 994 F. Supp., at 1250.

 

    1. A drive by Andrew Magee earlier this year produced a result that he neither intended nor expected. While the foursome ahead of him was still on the green, he teed off on a 322-yard par four. To his surprise, the ball not only reached the green, but also bounced off Tom Byrum’s putter and into the hole. Davis, Magee Gets Ace on Par-4, Ariz. Republic, Jan. 26, 2001, p. C16, 2001 WL 8510792.

 

    1. That has been so not only in the SENIOR PGA TOUR and the first two stages of the Q-School, but also, as Martin himself noticed, in the third stage of the Q-School after petitioner permitted everyone to ride rather than just waiving the walking rule for Martin as required by the District Court’s injunction.

 

    1. App. 201. See also id., at 179-180 (deposition testimony of Gerry Norquist); id., at 225-226 (trial testimony of Harry Toscano).

 

    1. Hence, petitioner’s questioning of the ability of courts to apply the reasonable modification requirement to athletic competition is a complaint more properly directed to Congress, which drafted the ADA’s coverage broadly, than to us. Even more misguided is Justice Scalia’s suggestion that Congress did not place that inquiry into the hands of the courts at all. According to the dissent, the game of golf as sponsored by petitioner is, like all sports games, the sum of its “arbitrary rules,” and no one, including courts, “can pronounce one or another of them to be ‘nonessential’ if the rulemaker (here the PGA TOUR) deems it to be essential.” Post, at 700. Whatever the merit of Justice Scalia’s postmodern view of “What Is [Sport],” ibid., it is clear that Congress did not enshrine it in Title III of the ADA. While Congress expressly exempted “private clubs or establishments” and “religious organizations or entities” from Title III’s coverage, 42 U. S. C. § 12187, Congress made no such exception for athletic competitions, much less did it give sports organizations carte blanche authority to exempt themselves from the fundamental alteration inquiry by deeming any rule, no matter how peripheral to the competition, to be essential. In short, Justice Scalia’s reading of the statute renders the word “fundamentally” largely superfluous, because it treats the alteration of any rule governing an event at a public accommodation to be a fundamental alteration.

 

    1. On this fundamental point, the dissent agrees. See post, at 699 (“The PGA TOUR cannot deny respondent access to that game because of his disability”).

 

    1. However, we think petitioner’s contention that the task of assessing requests for modifications will amount to a substantial burden is overstated. As Martin indicates, in the three years since he requested the use of a cart, no one else has sued the PGA, and only two other golfers (one of whom is Olinger) have sued the USGA for a waiver of the walking rule. In addition, we believe petitioner’s point is misplaced, as nowhere in § 12182(b)(2)(A)(ii) does Congress limit the reasonable modification requirement only to requests that are easy to evaluate.

 

    1. The Court suggests that respondent is not an independent contractor because he “play[s] at [his] own pleasure,” and is not subject to PGA TOUR control “over [his] manner of performance,” ante, at 680, n. 33. But many independent contractors–composers of movie music, portrait artists, script writers, and even (some would say) plumbers–retain at least as much control over when and how they work as does respondent, who agrees to play in a minimum of 15 of the designated PGA TOUR events, and to play by the rules that the PGA TOUR specifies. Cf. Community for Creative Non-Violence v. Reid, 490 U. S. 730, 751-753 (1989) (discussing independent contractor status of a sculptor). Moreover, although, as the Court suggests in the same footnote, in rare cases a PGA TOUR winner will choose to forgo the prize money (in order, for example, to preserve amateur status necessary for continuing participation in college play) he is contractually entitled to the prize money if he demands it, which is all that a contractual relationship requires.

 

    1. The Court suggests that respondent is not an independent contractor because he “play[s] at [his] own pleasure,” and is not subject to PGA TOUR control “over [his] manner of performance,” ante, at 680, n. 33. But many independent contractors–composers of movie music, portrait artists, script writers, and even (some would say) plumbers–retain at least as much control over when and how they work as does respondent, who agrees to play in a minimum of 15 of the designated PGA TOUR events, and to play by the rules that the PGA TOUR specifies. Cf. Community for Creative Non-Violence v. Reid, 490 U. S. 730, 751-753 (1989) (discussing independent contractor status of a sculptor). Moreover, although, as the Court suggests in the same footnote, in rare cases a PGA TOUR winner will choose to forgo the prize money (in order, for example, to preserve amateur status necessary for continuing participation in college play) he is contractually entitled to the prize money if he demands it, which is all that a contractual relationship requires.

 

 

 

Excerpt from Mark Kelman, Market Discrimination and Groups, 53 Stan. L. Rev. 833 (2001)

 

 

 

The Americans with Disabilities Act contemplates granting those people whose rights under the statute are violated two distinct remedies, each of which implicitly instantiates a distinct entitlement. First, like all antidiscrimination statutes, it clearly prohibits “simple discrimination” (differential treatment despite equality along “relevant” dimensions), permitting plaintiffs to enjoin improper refusals to serve or refusals to hire in situations in which plaintiffs can convince decisionmakers that they were denied access though “qualified” for such access. Second, it mandates “reasonable accommodation” (of relevant differences), permitting plaintiffs to secure more complex mandatory injunctions demanding that the defendant take particular affirmative steps to permit them to enjoy the relevant public accommodation or to work at the relevant job.

 

Obviously, people may be unequal in ways some would deem relevant and others would not; thus, figuring out when a party can invoke the right to prohibit simple discrimination requires some consensus on what traits potential defendants can deem relevant. The right to demand reasonable accommodation likewise requires us to decide which distinctions should be accommodated. (As a matter of positive law, a blind lawyer may be entitled to a reader, without bearing the cost of hiring the reader; a lawyer who spells poorly or writes ungrammatically, unless deemed “dyslexic” is not entitled to a free spell-check program or an editor. As I note in a bit more detail later, the reason for the distinction is hardly lucid as a matter of distributive ethics.)

 

There are relatively precise conventional understandings of when plaintiffs are mistreated in ways that entitle them to these remedies, though, defined in relationship to conventional understandings of the workings of a market economy. A person suffers from simple discrimination insofar as an employer (in the employment discrimination context traditionally regulated by Title VII) or a public accommodation owner (in the public accommodation context traditionally regulated by Title II of the 1964 Civil Rights Act) fails to treat him “impersonally.” Insofar as the employer or public accommodation owner fails to give the employee or customer something he desires because of traits that are irrelevant to his economic function, he is breaching the duty to avoid simple discrimination. A public accommodation owner discriminates in this way if he does not treat a potential customer as well as he treats other customers who supply him the same net proceeds (money he will receive to provide a service net of the costs of service provision). An employer discriminates insofar as he treats the plaintiff employee or job applicant worse than he treats statistically typical employees or applicants whose net marginal product is no higher. (A worker’s net marginal product is equal to the value of the increase in goods or services the firm will produce if the employee is added to the firm, net of the added costs that the firm will incur if she were employed by that firm.) In this sense, what distinguishes a market actor’s claim that there are only certain “relevant” grounds for differentiation from what are clearly closely cognate claims that any actor is entitled to “meritocratic” treatment in any realm (e.g., college admissions) is the relative consensus on how limited the logical criteria for employment and service really are.

 

In certain circumstances, customers or employees may be entitled to reasonable accommodation in the sense that the public accommodation owner or employer has a duty to treat the customer or worker in terms of her gross, not net, value added to the firm. That is to say, the putative defendant may have an obligation to ignore the incremental input costs associated with serving the customer or insuring that the worker/applicant produces the same gross output as those who have been treated more favorably.

 

The accommodation obligation, though, is invariably a limited one. First, the added inputs that the plaintiff seeks are unreasonable if they would benefit (large numbers of?) other customers or potential employees (nearly as much?) as they would benefit the plaintiff. In this sense, the accommodation obligation is limited to those who are thought to be as “meritorious” as those who can work without accommodation. Naturally, the concept of merit that the accommodation plaintiff relies on is (at least marginally) more contested than the concept the simple discrimination plaintiff relies on. The plaintiff seeking accommodation does not claim to merit the treatment she asks for because she has the same relevant traits as the person who has received better treatment: She concedes that a business rationally differentiates workers or customers on the basis of the differential input costs associated with serving them. Instead, she argues that her “talent” is defined by her capacity to produce, and that her capacity to produce is measured by the output she can generate without using aids that benefit workers generally. The metaphor is one of athletes competing in a contest: A “disabled” pole vaulter who vaults as high as his competitors using the especially expensive shoes he needs that would not benefit other vaulters is “as good” a vaulter as those using ordinary shoes. One who can do as well only by using an expensive pole made of a strong, flexible material that would improve any pole vaulter’s performance is not “as good.”

 

Second, the cost of these atypical inputs must not be unduly high: It must be “reasonable” in that sense. In this sense, the accommodation obligation is limited by the fact that we must expend real social resources to meet it. (I return to discuss the fact that the defendant who wishes to engage in simple discrimination must sacrifice private, psychic utility if asked to desist, but not physical resources. His discriminatory desires are not representative of society’s desires; we wish no one had those tastes. The defendant resisting demands to accommodate attempts to save real resources. In that sense, his desire to save resources is representative of general social desires to save resources. We do not wish to abolish the taste to save such resources, even if we believe in a particular case that the best use of the resources is to use them to accommodate.) Because we must expend real resources to meet the demand for accommodation, we compare the value of expending the resources to meet the policy goals of accommodation with the value of expending the resources to meet other social policy aims.

 

Two straightforward illustrations might help differentiate accommodation and simple discrimination claims. The simple antidiscrimination principle would preclude a dentist (as public accommodations provider) from refusing to treat a hearing impaired patient, so long as his inability to communicate with the patient neither affected the price the patient would pay nor the cost of serving him. The accommodation principle would require that the dentist take steps to be able to communicate with the hearing impaired patient, if necessary to provide her with the same quality care he gives other patients, without charging the patient the incremental costs of treating her. This is true even though a simple nondiscriminating, impersonal, capitalist calculator would refuse to treat a patient who is atypically costly to serve unless permitted to charge more for the services in the absence of a supplementary duty to accommodate.

 

In the employment context, the conventional antidiscrimination norm forbids an employer from refusing to hire a blind lawyer who can do the same legal work as a sighted one. The accommodation principle demands that the employer not reduce the blind lawyer’s pay if he requires a (“reasonably” costly) reader to generate the same work that sighted lawyers do without an aide.

 

It is vital to note that it is often difficult to determine whether a particular plaintiff claims to be the victim of simple discrimination or whether she claims instead that she is entitled to a reasonable accommodation. When, for instance, an employee asks an employer to adjust his work schedule, he is claiming first that his net output on the adjusted schedule is no lower than that of fellow employees following the more conventional schedule. Thus, the refusal to hire him on the reduced schedule is a form of simple discrimination. He will often argue in the alternative, though, that if his net output is indeed lower, it is nonetheless reasonable to ask the employer to bear the costs associated with the net productivity shortfall because they must be borne if the plaintiff is to work.

 

… .

 

In this section, I argue briefly that it is appropriate to think that those seeking protection from simple discrimination possess “rights” claims while those seeking accommodations are making “distributive” claims. Accommodation claims are best conceived of as zero-sum, distributive claims to a finite pot of redistributed social resources, competing not only with the demands of others who seek accommodation (or the wishes of putative defendants) but with all claimants on state resources. (Because the demands are zero-sum competitive resource demands, it may be apt to reject them simply because they are “too costly”–unreasonable in the sense that the resources could do more good put to other uses.) On the other hand, claims to abolish simple discrimination should be thought of as rights claims in the sense that they do not compete with other claims to abolish such discrimination nor the cost concerns of defendants.

 

Though I wish to distinguish these antidiscrimination principles, I recognize that claims made by those seeking protection from simple discrimination and claims made by those seeking costly accommodations clearly resemble one another in significant ways. Most obviously, in each case, the putative plaintiffs seek inclusion in a situation in which the putative defendant spontaneously chooses to deny him access. Tautologically, then, the defendant will bear some cost if the plaintiff is to gain what he seeks: If she did not bear such a cost, she would willingly give the plaintiff access.

 

Less obviously, the claims are similar in the sense that each is incomplete insofar as the goal of the norm is to guarantee inclusion. Plaintiffs may still be excluded (and suffer at least some of the harms we associate with exclusion) even if their claims under each norm are fully vindicated. Customers unable to pay market prices will not receive service from public accommodation owners obeying norms against simple discrimination, even if such customers are disproportionately members of the social groups typically protected by antidiscrimination norms. (Similarly, workers with lower marginal products will be excluded from more desirable positions.) Customers who cannot be served without unreasonably costly accommodations will not receive service; workers who cannot produce as much as others without using inputs that are unreasonable (too expensive, or of “substantial” use to others) will not get desired jobs. In each case, too, the norm would be more inclusive if we increased the fiscal burden on the putative defendants. If sellers were asked to subsidize purchases by poorer buyers from subordinated groups, the norm against simple discrimination would be less exclusionary. Similarly, more members of excluded groups would be included if we demanded more expensive accommodations that would permit those seeking inclusion to function in the workplace.

 

What ultimately distinguishes the cases is that the deliberate simple discriminator (just like the deliberate tortfeasor) gains utility if able to resist the plaintiffs’ demands for reasons that are quite distinct from the reasons that the nonaccommodating defendant (or potential taxpayer) does. The nonaccommodating defendant (and taxpayer) attempts to retain (or save) real social resources, resources that could be utilized by themselves for any number of projects (or by others the state designates given its power to tax and spend). These resources are public and objective, and the desire to expend them completely socially legitimate. Moreover, they are intrinsically finite. It is conceptually impossible that all demands for accommodation (or demands to meet medical “need”) could be met simply if the defendants of the world desired them to be met.

 

On the other hand, both the simple discriminator (and the tortfeasor) gain utility from acting on tastes that are ordinarily imperfectly fungible, private/subjective, and arguably illegitimate. Moreover, it is conceptually possible to meet all demands to be free from simple discrimination simply through (privately controllable) changes in subjective tastes (or conduct). If each individual changed her attitude (and gained nothing from market irrational treatment in the discrimination context, gained nothing from causing pain in the intentional torts context), all simple discrimination (and intentional torts) could disappear. Thus, when the nonaccommodating defendant resists the expenditure of real social resources, she is acting, in essence, as a representative surrogate for the public, seeking optimal expenditure of these funds. (And thus should be thought of as a taxpayer, a source of public funds.) When she seeks to protect her gains from discriminating or injuring others, she does not act in such a representative capacity. The state does not try to appropriate, but destroy, her “resource.”

 

 

 

7.4. Takings

 

7.4.1. Eminent Domain

 

Kelo et al. v. City of New London et. al.,

545 U.S. 469 (2005)

 

 

 

Scott G. Bullock argued the cause for petitioners. With him on the briefs were William H. Mellor, Dana Berliner, and Scott W. Sawyer.

 

Wesley W. Horton argued the cause for respondents. With him on the brief were Thomas J. Londregan, Jeffrey T. Londregan, Edward B. O’Connell, and David P. Condon.1

 

 

 

Justice Stevens delivered the opinion of the Court.

 

 

 

In 2000, the city of New London approved a development plan that, in the words of the Supreme Court of Connecticut, was “projected to create in excess of 1,000 jobs, to increase tax and other revenues, and to revitalize an economically distressed city, including its downtown and waterfront areas.” 268 Conn. 1, 5, 843 A. 2d 500, 507 (2004). In assembling the land needed for this project, the city’s development agent has purchased property from willing sellers and proposes to use the power of eminent domain to acquire the remainder of the property from unwilling owners in exchange for just compensation. The question presented is whether the city’s proposed disposition of this property qualifies as a “public use” within the meaning of the Takings Clause of the Fifth Amendment to the Constitution.2

 

 

 

 

I

 

 

 

 

The city of New London (hereinafter City) sits at the junction of the Thames River and the Long Island Sound in southeastern Connecticut. Decades of economic decline led a state agency in 1990 to designate the City a “distressed municipality.” In 1996, the Federal Government closed the Naval Undersea Warfare Center, which had been located in the Fort Trumbull area of the City and had employed over 1,500 people. In 1998, the City’s unemployment rate was nearly double that of the State, and its population of just under 24,000 residents was at its lowest since 1920.

 

These conditions prompted state and local officials to target New London, and particularly its Fort Trumbull area, for economic revitalization. To this end, respondent New London Development Corporation (NLDC), a private nonprofit entity established some years earlier to assist the City in planning economic development, was reactivated. In January 1998, the State authorized a $5.35 million bond issue to support the NLDC’s planning activities and a $10 million bond issue toward the creation of a Fort Trumbull State Park. In February, the pharmaceutical company Pfizer Inc. announced that it would build a $300 million research facility on a site immediately adjacent to Fort Trumbull; local planners hoped that Pfizer would draw new business to the area, thereby serving as a catalyst to the area’s rejuvenation. After receiving initial approval from the city council, the NLDC continued its planning activities and held a series of neighborhood meetings to educate the public about the process. In May, the city council authorized the NLDC to formally submit its plans to the relevant state agencies for review.3 Upon obtaining state-level approval, the NLDC finalized an integrated development plan focused on 90 acres of the Fort Trumbull area.

 

The Fort Trumbull area is situated on a peninsula that juts into the Thames River. The area comprises approximately 115 privately owned properties, as well as the 32 acres of land formerly occupied by the naval facility (Trumbull State Park now occupies 18 of those 32 acres). The development plan encompasses seven parcels. Parcel 1 is designated for a waterfront conference hotel at the center of a “small urban village” that will include restaurants and shopping. This parcel will also have marinas for both recreational and commercial uses. A pedestrian “riverwalk” will originate here and continue down the coast, connecting the waterfront areas of the development. Parcel 2 will be the site of approximately 80 new residences organized into an urban neighborhood and linked by public walkway to the remainder of the development, including the state park. This parcel also includes space reserved for a new U. S. Coast Guard Museum. Parcel 3, which is located immediately north of the Pfizer facility, will contain at least 90,000 square feet of research and development office space. Parcel 4A is a 2.4-acre site that will be used either to support the adjacent state park, by providing parking or retail services for visitors, or to support the nearby marina. Parcel 4B will include a renovated marina, as well as the final stretch of the riverwalk. Parcels 5, 6, and 7 will provide land for office and retail space, parking, and water-dependent commercial uses. App. 109-113.

 

The NLDC intended the development plan to capitalize on the arrival of the Pfizer facility and the new commerce it was expected to attract. In addition to creating jobs, generating tax revenue, and helping to “build momentum for the revitalization of downtown New London,” id., at 92, the plan was also designed to make the City more attractive and to create leisure and recreational opportunities on the waterfront and in the park.

 

The city council approved the plan in January 2000, and designated the NLDC as its development agent in charge of implementation. See Conn. Gen. Stat. § 8-188 (2005). The city council also authorized the NLDC to purchase property or to acquire property by exercising eminent domain in the City’s name. § 8-193. The NLDC successfully negotiated the purchase of most of the real estate in the 90-acre area, but its negotiations with petitioners failed. As a consequence, in November 2000, the NLDC initiated the condemnation proceedings that gave rise to this case.4

 

 

 

 

II

 

 

 

 

Petitioner Susette Kelo has lived in the Fort Trumbull area since 1997. She has made extensive improvements to her house, which she prizes for its water view. Petitioner Wilhelmina Dery was born in her Fort Trumbull house in 1918 and has lived there her entire life. Her husband Charles (also a petitioner) has lived in the house since they married some 60 years ago. In all, the nine petitioners own 15 properties in Fort Trumbull–4 in parcel 3 of the development plan and 11 in parcel 4A. Ten of the parcels are occupied by the owner or a family member; the other five are held as investment properties. There is no allegation that any of these properties is blighted or otherwise in poor condition; rather, they were condemned only because they happen to be located in the development area.

 

In December 2000, petitioners brought this action in the New London Superior Court. They claimed, among other things, that the taking of their properties would violate the “public use” restriction in the Fifth Amendment. After a 7-day bench trial, the Superior Court granted a permanent restraining order prohibiting the taking of the properties located in parcel 4A (park or marina support). It, however, denied petitioners relief as to the properties located in parcel 3 (office space). App. to Pet. for Cert. 343-350.5

 

After the Superior Court ruled, both sides took appeals to the Supreme Court of Connecticut. That court held, over a dissent, that all of the City’s proposed takings were valid. It began by upholding the lower court’s determination that the takings were authorized by chapter 132, the State’s municipal development statute. See Conn. Gen. Stat. § 8-186 et seq. (2005). That statute expresses a legislative determination that the taking of land, even developed land, as part of an economic development project is a “public use” and in the “public interest.” 268 Conn., at 18-28, 843 A. 2d, at 515-521. Next, relying on cases such as Hawaii Housing Authority v. Midkiff, 467 U. S. 229 (1984), and Berman v. Parker, 348 U. S. 26 (1954), the court held that such economic development qualified as a valid public use under both the Federal and State Constitutions. 268 Conn., at 40, 843 A. 2d, at 527.

 

Finally, adhering to its precedents, the court went on to determine, first, whether the takings of the particular properties at issue were “reasonably necessary” to achieving the City’s intended public use, id., at 82-84, 843 A. 2d, at 552-553, and, second, whether the takings were for “reasonably foreseeable needs,” id., at 93-94, 843 A. 2d, at 558-559. The court upheld the trial court’s factual findings as to parcel 3, but reversed the trial court as to parcel 4A, agreeing with the City that the intended use of this land was sufficiently definite and had been given “reasonable attention” during the planning process. Id., at 120-121, 843 A. 2d, at 574.

 

The three dissenting justices would have imposed a “heightened” standard of judicial review for takings justified by economic development. Although they agreed that the plan was intended to serve a valid public use, they would have found all the takings unconstitutional because the City had failed to adduce “clear and convincing evidence” that the economic benefits of the plan would in fact come to pass. Id., at 144, 146, 843 A. 2d, at 587, 588 (Zarella, J., joined by Sullivan, C. J., and Katz, J., concurring in part and dissenting in part).

 

We granted certiorari to determine whether a city’s decision to take property for the purpose of economic development satisfies the “public use” requirement of the Fifth Amendment. 542 U. S. 965 (2004).

 

 

 

 

III

 

 

 

 

Two polar propositions are perfectly clear. On the one hand, it has long been accepted that the sovereign may not take the property of A for the sole purpose of transferring it to another private party B, even though A is paid just compensation. On the other hand, it is equally clear that a State may transfer property from one private party to another if future “use by the public” is the purpose of the taking; the condemnation of land for a railroad with common-carrier duties is a familiar example. Neither of these propositions, however, determines the disposition of this case.

 

As for the first proposition, the City would no doubt be forbidden from taking petitioners’ land for the purpose of conferring a private benefit on a particular private party. See Midkiff, 467 U. S., at 245 (“A purely private taking could not withstand the scrutiny of the public use requirement; it would serve no legitimate purpose of government and would thus be void”); Missouri Pacific R. Co. v. Nebraska, 164 U. S. 403 (1896).6 Nor would the City be allowed to take property under the mere pretext of a public purpose, when its actual purpose was to bestow a private benefit. The takings before us, however, would be executed pursuant to a “carefully considered” development plan. 268 Conn., at 54, 843 A. 2d, at 536. The trial judge and all the members of the Supreme Court of Connecticut agreed that there was no evidence of an illegitimate purpose in this case.7 Therefore, as was true of the statute challenged in Midkiff, 467 U. S., at 245, the City’s development plan was not adopted “to benefit a particular class of identifiable individuals.”

 

On the other hand, this is not a case in which the City is planning to open the condemned land–at least not in its entirety–to use by the general public. Nor will the private lessees of the land in any sense be required to operate like common carriers, making their services available to all comers. But although such a projected use would be sufficient to satisfy the public use requirement, this “Court long ago rejected any literal requirement that condemned property be put into use for the general public.” Id., at 244. Indeed, while many state courts in the mid-19th century endorsed “use by the public” as the proper definition of public use, that narrow view steadily eroded over time. Not only was the “use by the public” test difficult to administer (e. g., what proportion of the public need have access to the property? at what price?),8 but it proved to be impractical given the diverse and always evolving needs of society.9 Accordingly, when this Court began applying the Fifth Amendment to the States at the close of the 19th century, it embraced the broader and more natural interpretation of public use as “public purpose.” See, e. g., Fallbrook Irrigation Dist. v. Bradley, 164 U. S. 112, 158-164 (1896). Thus, in a case upholding a mining company’s use of an aerial bucket line to transport ore over property it did not own, Justice Holmes’ opinion for the Court stressed “the inadequacy of use by the general public as a universal test.” Strickley v. Highland Boy Gold Mining Co., 200 U. S. 527, 531 (1906).10 We have repeatedly and consistently rejected that narrow test ever since.11

 

The disposition of this case therefore turns on the question whether the City’s development plan serves a “public purpose.” Without exception, our cases have defined that concept broadly, reflecting our longstanding policy of deference to legislative judgments in this field.

 

In Berman v. Parker, 348 U. S. 26 (1954), this Court upheld a redevelopment plan targeting a blighted area of Washington, D. C., in which most of the housing for the area’s 5,000 inhabitants was beyond repair. Under the plan, the area would be condemned and part of it utilized for the construction of streets, schools, and other public facilities. The remainder of the land would be leased or sold to private parties for the purpose of redevelopment, including the construction of low-cost housing.

 

The owner of a department store located in the area challenged the condemnation, pointing out that his store was not itself blighted and arguing that the creation of a “better balanced, more attractive community” was not a valid public use. Id., at 31. Writing for a unanimous Court, Justice Douglas refused to evaluate this claim in isolation, deferring instead to the legislative and agency judgment that the area “must be planned as a whole” for the plan to be successful. Id., at 34. The Court explained that “community redevelopment programs need not, by force of the Constitution, be on a piecemeal basis–lot by lot, building by building.” Id., at 35. The public use underlying the taking was unequivocally affirmed:

 

 

“We do not sit to determine whether a particular housing project is or is not desirable. 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. In the present case, the Congress and its authorized agencies have made determinations that take into account a wide variety of values. It is not for us to reappraise them. If those who govern the District of Columbia decide that the Nation’s Capital should be beautiful as well as sanitary, there is nothing in the Fifth Amendment that stands in the way.” Id., at 33.

 

 

In Hawaii Housing Authority v. Midkiff, 467 U. S. 229 (1984), the Court considered a Hawaii statute whereby fee title was taken from lessors and transferred to lessees (for just compensation) in order to reduce the concentration of land ownership. We unanimously upheld the statute and rejected the Ninth Circuit’s view that it was “a naked attempt on the part of the state of Hawaii to take the property of A and transfer it to B solely for B’s private use and benefit.” Id., at 235 (internal quotation marks omitted). Reaffirming Berman’s deferential approach to legislative judgments in this field, we concluded that the State’s purpose of eliminating the “social and economic evils of a land oligopoly” qualified as a valid public use. 467 U. S., at 241-242. Our opinion also rejected the contention that the mere fact that the State immediately transferred the properties to private individuals upon condemnation somehow diminished the public character of the taking. “[I]t is only the taking’s purpose, and not its mechanics,” we explained, that matters in determining public use. Id., at 244.

 

In that same Term we decided another public use case that arose in a purely economic context. In Ruckelshaus v. Monsanto Co., 467 U. S. 986 (1984), the Court dealt with provisions of the Federal Insecticide, Fungicide, and Rodenticide Act under which the Environmental Protection Agency could consider the data (including trade secrets) submitted by a prior pesticide applicant in evaluating a subsequent application, so long as the second applicant paid just compensation for the data. We acknowledged that the “most direct beneficiaries” of these provisions were the subsequent applicants, id., at 1014, but we nevertheless upheld the statute under Berman and Midkiff. We found sufficient Congress’ belief that sparing applicants the cost of time-consuming research eliminated a significant barrier to entry in the pesticide market and thereby enhanced competition. 467 U. S., at 1015.

 

Viewed as a whole, our jurisprudence has recognized that the needs of society have varied between different parts of the Nation, just as they have evolved over time in response to changed circumstances. Our earliest cases in particular embodied a strong theme of federalism, emphasizing the “great respect” that we owe to state legislatures and state courts in discerning local public needs. See Hairston v. Danville & Western R. Co., 208 U. S. 598, 606-607 (1908) (noting that these needs were likely to vary depending on a State’s “resources, the capacity of the soil, the relative importance of industries to the general public welfare, and the long-established methods and habits of the people”).12 For more than a century, our public use jurisprudence has wisely eschewed rigid formulas and intrusive scrutiny in favor of affording legislatures broad latitude in determining what public needs justify the use of the takings power.

 

 

 

 

IV

 

 

 

 

Those who govern the City were not confronted with the need to remove blight in the Fort Trumbull area, but their determination that the area was sufficiently distressed to justify a program of economic rejuvenation is entitled to our deference. The City has carefully formulated an economic development plan that it believes will provide appreciable benefits to the community, including–but by no means limited to–new jobs and increased tax revenue. As with other exercises in urban planning and development,13 the City is endeavoring to coordinate a variety of commercial, residential, and recreational uses of land, with the hope that they will form a whole greater than the sum of its parts. To effectuate this plan, the City has invoked a state statute that specifically authorizes the use of eminent domain to promote economic development. Given the comprehensive character of the plan, the thorough deliberation that preceded its adoption, and the limited scope of our review, it is appropriate for us, as it was in Berman, to resolve the challenges of the individual owners, not on a piecemeal basis, but rather in light of the entire plan. Because that plan unquestionably serves a public purpose, the takings challenged here satisfy the public use requirement of the Fifth Amendment.

 

To avoid this result, petitioners urge us to adopt a new bright-line rule that economic development does not qualify as a public use. Putting aside the unpersuasive suggestion that the City’s plan will provide only purely economic benefits, neither precedent nor logic supports petitioners’ proposal. Promoting economic development is a traditional and long-accepted function of government. There is, moreover, no principled way of distinguishing economic development from the other public purposes that we have recognized. In our cases upholding takings that facilitated agriculture and mining, for example, we emphasized the importance of those industries to the welfare of the States in question, see, e. g., Strickley, 200 U. S. 527; in Berman, we endorsed the purpose of transforming a blighted area into a “well-balanced” community through redevelopment, 348 U. S., at 33;14 in Midkiff, we upheld the interest in breaking up a land oligopoly that “created artificial deterrents to the normal functioning of the State’s residential land market,” 467 U. S., at 242; and in Monsanto, we accepted Congress’ purpose of eliminating a “significant barrier to entry in the pesticide market,” 467 U. S., at 1014-1015. It would be incongruous to hold that the City’s interest in the economic benefits to be derived from the development of the Fort Trumbull area has less of a public character than any of those other interests. Clearly, there is no basis for exempting economic development from our traditionally broad understanding of public purpose.

 

Petitioners contend that using eminent domain for economic development impermissibly blurs the boundary between public and private takings. Again, our cases foreclose this objection. Quite simply, the government’s pursuit of a public purpose will often benefit individual private parties. For example, in Midkiff, the forced transfer of property conferred a direct and significant benefit on those lessees who were previously unable to purchase their homes. In Monsanto, we recognized that the “most direct beneficiaries” of the data-sharing provisions were the subsequent pesticide applicants, but benefiting them in this way was necessary to promoting competition in the pesticide market. 467 U. S., at 1014.15 The owner of the department store in Berman objected to “taking from one businessman for the benefit of another businessman,” 348 U. S., at 33, referring to the fact that under the redevelopment plan land would be leased or sold to private developers for redevelopment.16 Our rejection of that contention has particular relevance to the instant case: “The public end may be as well or better served through an agency of private enterprise than through a department of government–or so the Congress might conclude. We cannot say that public ownership is the sole method of promoting the public purposes of community redevelopment projects.” Id., at 33-34.17

 

It is further argued that without a bright-line rule nothing would stop a city from transferring citizen A’s property to citizen B for the sole reason that citizen B will put the property to a more productive use and thus pay more taxes. Such a one-to-one transfer of property, executed outside the confines of an integrated development plan, is not presented in this case. While such an unusual exercise of government power would certainly raise a suspicion that a private purpose was afoot,18 the hypothetical cases posited by petitioners can be confronted if and when they arise.19 They do not warrant the crafting of an artificial restriction on the concept of public use.20

 

Alternatively, petitioners maintain that for takings of this kind we should require a “reasonable certainty” that the expected public benefits will actually accrue. Such a rule, however, would represent an even greater departure from our precedent. “When the legislature’s purpose is legitimate and its means are not irrational, our cases make clear that empirical debates over the wisdom of takings–no less than debates over the wisdom of other kinds of socioeconomic legislation–are not to be carried out in the federal courts.” Midkiff, 467 U. S., at 242-243.21 Indeed, earlier this Term we explained why similar practical concerns (among others) undermined the use of the “substantially advances” formula in our regulatory takings doctrine. See Lingle v. Chevron U. S. A. Inc., 544 U. S. 528, 544 (2005) (noting that this formula “would empower–and might often require–courts to substitute their predictive judgments for those of elected legislatures and expert agencies”). The disadvantages of a heightened form of review are especially pronounced in this type of case. Orderly implementation of a comprehensive redevelopment plan obviously requires that the legal rights of all interested parties be established before new construction can be commenced. A constitutional rule that required postponement of the judicial approval of every condemnation until the likelihood of success of the plan had been assured would unquestionably impose a significant impediment to the successful consummation of many such plans.

 

Just as we decline to second-guess the City’s considered judgments about the efficacy of its development plan, we also decline to second-guess the City’s determinations as to what lands it needs to acquire in order to effectuate the project. “It is not for the courts to oversee the choice of the boundary line nor to sit in review on the size of a particular project area. Once the question of the public purpose has been decided, the amount and character of land to be taken for the project and the need for a particular tract to complete the integrated plan rests in the discretion of the legislative branch.” Berman, 348 U. S., at 35-36.

 

In affirming the City’s authority to take petitioners’ properties, we do not minimize the hardship that condemnations may entail, notwithstanding the payment of just compensation.22 We emphasize that nothing in our opinion precludes any State from placing further restrictions on its exercise of the takings power. Indeed, many States already impose “public use” requirements that are stricter than the federal baseline. Some of these requirements have been established as a matter of state constitutional law,23 while others are expressed in state eminent domain statutes that carefully limit the grounds upon which takings may be exercised.24 As the submissions of the parties and their amici make clear, the necessity and wisdom of using eminent domain to promote economic development are certainly matters of legitimate public debate.25 This Court’s authority, however, extends only to determining whether the City’s proposed condemnations are for a “public use” within the meaning of the Fifth Amendment to the Federal Constitution. Because over a century of our case law interpreting that provision dictates an affirmative answer to that question, we may not grant petitioners the relief that they seek.

 

The judgment of the Supreme Court of Connecticut is affirmed.

 

It is so ordered.

 

 

 

Justice Kennedy, concurring.

 

 

 

I join the opinion for the Court and add these further observations.

 

This Court has declared that a taking should be upheld as consistent with the Public Use Clause, U. S. Const., Amdt. 5, as long as it is “rationally related to a conceivable public purpose.” Hawaii Housing Authority v. Midkiff, 467 U. S. 229, 241 (1984); see also Berman v. Parker, 348 U. S. 26 (1954). This deferential standard of review echoes the rational-basis test used to review economic regulation under the Due Process and Equal Protection Clauses, see, e. g., FCC v. Beach Communications, Inc., 508 U. S. 307, 313-314 (1993); Williamson v. Lee Optical of Okla., Inc., 348 U. S. 483 (1955). The determination that a rational-basis standard of review is appropriate does not, however, alter the fact that transfers intended to confer benefits on particular, favored private entities, and with only incidental or pretextual public benefits, are forbidden by the Public Use Clause.

 

A court applying rational-basis review under the Public Use Clause should strike down a taking that, by a clear showing, is intended to favor a particular private party, with only incidental or pretextual public benefits, just as a court applying rational-basis review under the Equal Protection Clause must strike down a government classification that is clearly intended to injure a particular class of private parties, with only incidental or pretextual public justifications. See Cleburne v. Cleburne Living Center, Inc., 473 U. S. 432, 446-447, 450 (1985); Department of Agriculture v. Moreno, 413 U. S. 528, 533-536 (1973). As the trial court in this case was correct to observe: “Where the purpose [of a taking] is economic development and that development is to be carried out by private parties or private parties will be benefited, the court must decide if the stated public purpose–economic advantage to a city sorely in need of it–is only incidental to the benefits that will be confined on private parties of a development plan.” App. to Pet. for Cert. 263. See also ante, at 477-478.

 

A court confronted with a plausible accusation of impermissible favoritism to private parties should treat the objection as a serious one and review the record to see if it has merit, though with the presumption that the government’s actions were reasonable and intended to serve a public purpose. Here, the trial court conducted a careful and extensive inquiry into “whether, in fact, the development plan is of primary benefit to … the developer [i. e., Corcoran Jennison], and private businesses which may eventually locate in the plan area [e. g., Pfizer], and in that regard, only of incidental benefit to the city.” App. to Pet. for Cert. 261. The trial court considered testimony from government officials and corporate officers, id., at 266-271; documentary evidence of communications between these parties, ibid.; respondents’ awareness of New London’s depressed economic condition and evidence corroborating the validity of this concern, id., at 272-273, 278-279; the substantial commitment of public funds by the State to the development project before most of the private beneficiaries were known, id., at 276; evidence that respondents reviewed a variety of development plans and chose a private developer from a group of applicants rather than picking out a particular transferee beforehand, id., at 273, 278; and the fact that the other private beneficiaries of the project are still unknown because the office space proposed to be built has not yet been rented, id., at 278.

 

The trial court concluded, based on these findings, that benefiting Pfizer was not “the primary motivation or effect of this development plan”; instead, “the primary motivation for [respondents] was to take advantage of Pfizer’s presence.” Id., at 276. Likewise, the trial court concluded that “[t]here is nothing in the record to indicate that … [respondents] were motivated by a desire to aid [other] particular private entities.” Id., at 278. See also ante, at 478. Even the dissenting justices on the Connecticut Supreme Court agreed that respondents’ development plan was intended to revitalize the local economy, not to serve the interests of Pfizer, Corcoran Jennison, or any other private party. 268 Conn. 1, 159, 843 A. 2d 500, 595 (2004) (Zarella, J., concurring in part and dissenting in part). This case, then, survives the meaningful rational-basis review that in my view is required under the Public Use Clause.

 

Petitioners and their amici argue that any taking justified by the promotion of economic development must be treated by the courts as per se invalid, or at least presumptively invalid. Petitioners overstate the need for such a rule, however, by making the incorrect assumption that review under Berman and Midkiff imposes no meaningful judicial limits on the government’s power to condemn any property it likes. A broad per se rule or a strong presumption of invalidity, furthermore, would prohibit a large number of government takings that have the purpose and expected effect of conferring substantial benefits on the public at large and so do not offend the Public Use Clause.

 

My agreement with the Court that a presumption of invalidity is not warranted for economic development takings in general, or for the particular takings at issue in this case, does not foreclose the possibility that a more stringent standard of review than that announced in Berman and Midkiff might be appropriate for a more narrowly drawn category of takings. There may be private transfers in which the risk of undetected impermissible favoritism of private parties is so acute that a presumption (rebuttable or otherwise) of invalidity is warranted under the Public Use Clause. Cf. Eastern Enterprises v. Apfel, 524 U. S. 498, 549-550 (1998) (Kennedy, J., concurring in judgment and dissenting in part) (heightened scrutiny for retroactive legislation under the Due Process Clause). This demanding level of scrutiny, however, is not required simply because the purpose of the taking is economic development.

 

This is not the occasion for conjecture as to what sort of cases might justify a more demanding standard, but it is appropriate to underscore aspects of the instant case that convince me no departure from Berman and Midkiff is appropriate here. This taking occurred in the context of a comprehensive development plan meant to address a serious citywide depression, and the projected economic benefits of the project cannot be characterized as de minimis. The identities of most of the private beneficiaries were unknown at the time the city formulated its plans. The city complied with elaborate procedural requirements that facilitate review of the record and inquiry into the city’s purposes. In sum, while there may be categories of cases in which the transfers are so suspicious, or the procedures employed so prone to abuse, or the purported benefits are so trivial or implausible, that courts should presume an impermissible private purpose, no such circumstances are present in this case.

 

 

 

 

* * *

 

 

 

 

For the foregoing reasons, I join in the Court’s opinion.

 

 

 

Justice O’Connor, with whom The Chief Justice, Justice Scalia, and Justice Thomas join, dissenting.

 

 

 

Over two centuries ago, just after the Bill of Rights was ratified, Justice Chase wrote:

 

 

“An ACT of the Legislature (for I cannot call it a law) contrary to the great first principles of the social compact, cannot be considered a rightful exercise of legislative authority…. A few instances will suffice to explain what I mean…. [A] law that takes property from A. and gives it to B: It is against all reason and justice, for a people to entrust a Legislature with SUCH powers; and, therefore, it cannot be presumed that they have done it.” Calder v. Bull, 3 Dall. 386, 388 (1798) (emphasis deleted).

 

 

Today the Court abandons this long-held, basic limitation on government power. Under the banner of economic development, all private property is now vulnerable to being taken and transferred to another private owner, so long as it might be upgraded–i. e., given to an owner who will use it in a way that the legislature deems more beneficial to the public–in the process. To reason, as the Court does, that the incidental public benefits resulting from the subsequent ordinary use of private property render economic development takings “for public use” is to wash out any distinction between private and public use of property–and thereby effectively to delete the words “for public use” from the Takings Clause of the Fifth Amendment. Accordingly I respectfully dissent.

 

 

 

 

I

 

 

 

 

Petitioners are nine resident or investment owners of 15 homes in the Fort Trumbull neighborhood of New London, Connecticut. Petitioner Wilhelmina Dery, for example, lives in a house on Walbach Street that has been in her family for over 100 years. She was born in the house in 1918; her husband, petitioner Charles Dery, moved into the house when they married in 1946. Their son lives next door with his family in the house he received as a wedding gift, and joins his parents in this suit. Two petitioners keep rental properties in the neighborhood.

 

In February 1998, Pfizer Inc., the pharmaceuticals manufacturer, announced that it would build a global research facility near the Fort Trumbull neighborhood. Two months later, New London’s city council gave initial approval for the New London Development Corporation (NLDC) to prepare the development plan at issue here. The NLDC is a private, nonprofit corporation whose mission is to assist the city council in economic development planning. It is not elected by popular vote, and its directors and employees are privately appointed. Consistent with its mandate, the NLDC generated an ambitious plan for redeveloping 90 acres of Fort Trumbull in order to “complement the facility that Pfizer was planning to build, create jobs, increase tax and other revenues, encourage public access to and use of the city’s waterfront, and eventually ‘build momentum’ for the revitalization of the rest of the city.” App. to Pet. for Cert. 5.

 

Petitioners own properties in two of the plan’s seven parcels–Parcel 3 and Parcel 4A. Under the plan, Parcel 3 is slated for the construction of research and office space as a market develops for such space. It will also retain the existing Italian Dramatic Club (a private cultural organization) though the homes of three plaintiffs in that parcel are to be demolished. Parcel 4A is slated, mysteriously, for “‘park support.’” Id., at 345-346. At oral argument, counsel for respondents conceded the vagueness of this proposed use, and offered that the parcel might eventually be used for parking. Tr. of Oral Arg. 36.

 

To save their homes, petitioners sued New London and the NLDC, to whom New London has delegated eminent domain power. Petitioners maintain that the Fifth Amendment prohibits the NLDC from condemning their properties for the sake of an economic development plan. Petitioners are not holdouts; they do not seek increased compensation, and none is opposed to new development in the area. Theirs is an objection in principle: They claim that the NLDC’s proposed use for their confiscated property is not a “public” one for purposes of the Fifth Amendment. While the government may take their homes to build a road or a railroad or to eliminate a property use that harms the public, say petitioners, it cannot take their property for the private use of other owners simply because the new owners may make more productive use of the property.

 

 

 

 

II

 

 

 

 

The Fifth Amendment to the Constitution, made applicable to the States by the Fourteenth Amendment, provides that “private property [shall not] be taken for public use, without just compensation.” When interpreting the Constitution, we begin with the unremarkable presumption that every word in the document has independent meaning, “that no word was unnecessarily used, or needlessly added.” Wright v. United States, 302 U. S. 583, 588 (1938). In keeping with that presumption, we have read the Fifth Amendment’s language to impose two distinct conditions on the exercise of eminent domain: “[T]he taking must be for a ‘public use’ and ‘just compensation’ must be paid to the owner.” Brown v. Legal Foundation of Wash., 538 U. S. 216, 231-232 (2003).

 

These two limitations serve to protect “the security of Property,” which Alexander Hamilton described to the Philadelphia Convention as one of the “great obj[ects] of Gov[ernment].” 1 Records of the Federal Convention of 1787, p. 302 (M. Farrand ed. 1911). Together they ensure stable property ownership by providing safeguards against excessive, unpredictable, or unfair use of the government’s eminent domain power–particularly against those owners who, for whatever reasons, may be unable to protect themselves in the political process against the majority’s will.

 

While the Takings Clause presupposes that government can take private property without the owner’s consent, the just compensation requirement spreads the cost of condemnations and thus “prevents the public from loading upon one individual more than his just share of the burdens of government.” Monongahela Nav. Co. v. United States, 148 U. S. 312, 325 (1893); see also Armstrong v. United States, 364 U. S. 40, 49 (1960). The public use requirement, in turn, imposes a more basic limitation, circumscribing the very scope of the eminent domain power: Government may compel an individual to forfeit her property for the public’s use, but not for the benefit of another private person. This requirement promotes fairness as well as security. Cf. Tahoe-Sierra Preservation Council, Inc. v. Tahoe Regional Planning Agency, 535 U. S. 302, 336 (2002) (“The concepts of ‘fairness and justice’ … underlie the Takings Clause”).

 

Where is the line between “public” and “private” property use? We give considerable deference to legislatures’ determinations about what governmental activities will advantage the public. But were the political branches the sole arbiters of the public-private distinction, the Public Use Clause would amount to little more than hortatory fluff. An external, judicial check on how the public use requirement is interpreted, however limited, is necessary if this constraint on government power is to retain any meaning. See Cincinnati v. Vester, 281 U. S. 439, 446 (1930) (“It is well established that … the question [of] what is a public use is a judicial one”).

 

Our cases have generally identified three categories of takings that comply with the public use requirement, though it is in the nature of things that the boundaries between these categories are not always firm. Two are relatively straightforward and uncontroversial. First, the sovereign may transfer private property to public ownership–such as for a road, a hospital, or a military base. See, e. g., Old Dominion Land Co. v. United States, 269 U. S. 55 (1925); Rindge Co. v. County of Los Angeles, 262 U. S. 700 (1923). Second, the sovereign may transfer private property to private parties, often common carriers, who make the property available for the public’s use–such as with a railroad, a public utility, or a stadium. See, e. g., National Railroad Passenger Corporation v. Boston & Maine Corp., 503 U. S. 407 (1992); Mt. Vernon-Woodberry Cotton Duck Co. v. Alabama Interstate Power Co., 240 U. S. 30 (1916). But “public ownership” and “use-by-the-public” are sometimes too constricting and impractical ways to define the scope of the Public Use Clause. Thus we have allowed that, in certain circumstances and to meet certain exigencies, takings that serve a public purpose also satisfy the Constitution even if the property is destined for subsequent private use. See, e. g., Berman v. Parker, 348 U. S. 26 (1954); Hawaii Housing Authority v. Midkiff, 467 U. S. 229 (1984).

 

This case returns us for the first time in over 20 years to the hard question of when a purportedly “public purpose” taking meets the public use requirement. It presents an issue of first impression: Are economic development takings constitutional? I would hold that they are not. We are guided by two precedents about the taking of real property by eminent domain. In Berman, we upheld takings within a blighted neighborhood of Washington, D. C. The neighborhood had so deteriorated that, for example, 64.3% of its dwellings were beyond repair. 348 U. S., at 30. It had become burdened with “overcrowding of dwellings,” “lack of adequate streets and alleys,” and “lack of light and air.” Id., at 34. Congress had determined that the neighborhood had become “injurious to the public health, safety, morals, and welfare” and that it was necessary to “eliminat[e] all such injurious conditions by employing all means necessary and appropriate for the purpose,” including eminent domain. Id., at 28 (internal quotation marks omitted). Mr. Berman’s department store was not itself blighted. Having approved of Congress’ decision to eliminate the harm to the public emanating from the blighted neighborhood, however, we did not second-guess its decision to treat the neighborhood as a whole rather than lot-by-lot. Id., at 34-35; see also Midkiff, 467 U. S., at 244 (“[I]t is only the taking’s purpose, and not its mechanics, that must pass scrutiny”).

 

In Midkiff, we upheld a land condemnation scheme in Hawaii whereby title in real property was taken from lessors and transferred to lessees. At that time, the State and Federal Governments owned nearly 49% of the State’s land, and another 47% was in the hands of only 72 private landowners. Concentration of land ownership was so dramatic that on the State’s most urbanized island, Oahu, 22 landowners owned 72.5% of the fee simple titles. Id., at 232. The Hawaii Legislature had concluded that the oligopoly in land ownership was “skewing the State’s residential fee simple market, inflating land prices, and injuring the public tranquility and welfare,” and therefore enacted a condemnation scheme for redistributing title. Ibid.

 

In those decisions, we emphasized the importance of deferring to legislative judgments about public purpose. Because courts are ill equipped to evaluate the efficacy of proposed legislative initiatives, we rejected as unworkable the idea of courts’ “‘deciding on what is and is not a governmental function and … invalidating legislation on the basis of their view on that question at the moment of decision, a practice which has proved impracticable in other fields.’” Id., at 240-241 (quoting United States ex rel. TVA v. Welch, 327 U. S. 546, 552 (1946)); see Berman, supra, at 32 (“[T]he legislature, not the judiciary, is the main guardian of the public needs to be served by social legislation”); see also Lingle v. Chevron U. S. A. Inc., 544 U. S. 528 (2005). Likewise, we recognized our inability to evaluate whether, in a given case, eminent domain is a necessary means by which to pursue the legislature’s ends. Midkiff, supra, at 242; Berman, supra, at 33.

 

Yet for all the emphasis on deference, Berman and Midkiff hewed to a bedrock principle without which our public use jurisprudence would collapse: “A purely private taking could not withstand the scrutiny of the public use requirement; it would serve no legitimate purpose of government and would thus be void.” Midkiff, 467 U. S., at 245; id., at 241 (“[T]he Court’s cases have repeatedly stated that ‘one person’s property may not be taken for the benefit of another private person without a justifying public purpose, even though compensation be paid’” (quoting Thompson v. Consolidated Gas Util. Corp., 300 U. S. 55, 80 (1937))); see also Missouri Pacific R. Co. v. Nebraska, 164 U. S. 403, 417 (1896). To protect that principle, those decisions reserved “a role for courts to play in reviewing a legislature’s judgment of what constitutes a public use … [though] the Court in Berman made clear that it is ‘an extremely narrow’ one.” Midkiff, supra, at 240 (quoting Berman, supra, at 32).

 

The Court’s holdings in Berman and Midkiff were true to the principle underlying the Public Use Clause. In both those cases, the extraordinary, precondemnation use of the targeted property inflicted affirmative harm on society–in Berman through blight resulting from extreme poverty and in Midkiff through oligopoly resulting from extreme wealth. And in both cases, the relevant legislative body had found that eliminating the existing property use was necessary to remedy the harm. Berman, supra, at 28-29; Midkiff, supra, at 232. Thus a public purpose was realized when the harmful use was eliminated. Because each taking directly achieved a public benefit, it did not matter that the property was turned over to private use. Here, in contrast, New London does not claim that Susette Kelo’s and Wilhelmina Dery’s well-maintained homes are the source of any social harm. Indeed, it could not so claim without adopting the absurd argument that any single-family home that might be razed to make way for an apartment building, or any church that might be replaced with a retail store, or any small business that might be more lucrative if it were instead part of a national franchise, is inherently harmful to society and thus within the government’s power to condemn.

 

In moving away from our decisions sanctioning the condemnation of harmful property use, the Court today significantly expands the meaning of public use. It holds that the sovereign may take private property currently put to ordinary private use, and give it over for new, ordinary private use, so long as the new use is predicted to generate some secondary benefit for the public–such as increased tax revenue, more jobs, maybe even esthetic pleasure. But nearly any lawful use of real private property can be said to generate some incidental benefit to the public. Thus, if predicted (or even guaranteed) positive side effects are enough to render transfer from one private party to another constitutional, then the words “for public use” do not realistically exclude any takings, and thus do not exert any constraint on the eminent domain power.

 

There is a sense in which this troubling result follows from errant language in Berman and Midkiff. In discussing whether takings within a blighted neighborhood were for a public use, Berman began by observing: “We deal, in other words, with what traditionally has been known as the police power.” 348 U. S., at 32. From there it declared that “[o]nce the object is within the authority of Congress, the right to realize it through the exercise of eminent domain is clear.” Id., at 33. Following up, we said in Midkiff that “[t]he ‘public use’ requirement is coterminous with the scope of a sovereign’s police powers.” 467 U. S., at 240. This language was unnecessary to the specific holdings of those decisions. Berman and Midkiff simply did not put such language to the constitutional test, because the takings in those cases were within the police power but also for “public use” for the reasons I have described. The case before us now demonstrates why, when deciding if a taking’s purpose is constitutional, the police power and “public use” cannot always be equated.

 

The Court protests that it does not sanction the bare transfer from A to B for B’s benefit. It suggests two limitations on what can be taken after today’s decision. First, it maintains a role for courts in ferreting out takings whose sole purpose is to bestow a benefit on the private transferee– without detailing how courts are to conduct that complicated inquiry. Ante, at 477-478. For his part, JUSTICE KENNEDY suggests that courts may divine illicit purpose by a careful review of the record and the process by which a legislature arrived at the decision to take–without specifying what courts should look for in a case with different facts, how they will know if they have found it, and what to do if they do not. Ante, at 491-492 (concurring opinion). Whatever the details of JUSTICE KENNEDY’s as-yet-undisclosed test, it is difficult to envision anyone but the “stupid staff[er]” failing it. See Lucas v. South Carolina Coastal Council, 505 U. S. 1003, 1025-1026, n. 12 (1992). The trouble with economic development takings is that private benefit and incidental public benefit are, by definition, merged and mutually reinforcing. In this case, for example, any boon for Pfizer or the plan’s developer is difficult to disaggregate from the promised public gains in taxes and jobs. See App. to Pet. for Cert. 275-277.

 

Even if there were a practical way to isolate the motives behind a given taking, the gesture toward a purpose test is theoretically flawed. If it is true that incidental public benefits from new private use are enough to ensure the “public purpose” in a taking, why should it matter, as far as the Fifth Amendment is concerned, what inspired the taking in the first place? How much the government does or does not desire to benefit a favored private party has no bearing on whether an economic development taking will or will not generate secondary benefit for the public. And whatever the reason for a given condemnation, the effect is the same from the constitutional perspective–private property is forcibly relinquished to new private ownership.

 

A second proposed limitation is implicit in the Court’s opinion. The logic of today’s decision is that eminent domain may only be used to upgrade–not downgrade–property. At best this makes the Public Use Clause redundant with the Due Process Clause, which already prohibits irrational government action. See Lingle, 544 U. S. 528. The Court rightfully admits, however, that the judiciary cannot get bogged down in predictive judgments about whether the public will actually be better off after a property transfer. In any event, this constraint has no realistic import. For who among us can say she already makes the most productive or attractive possible use of her property? The specter of condemnation hangs over all property. Nothing is to prevent the State from replacing any Motel 6 with a Ritz-Carlton, any home with a shopping mall, or any farm with a factory. Cf. Bugryn v. Bristol, 63 Conn. App. 98, 774 A. 2d 1042 (2001) (taking the homes and farm of four owners in their 70’s and 80’s and giving it to an “industrial park”); 99 Cents Only Stores v. Lancaster Redevelopment Agency, 237 F. Supp. 2d 1123 (CD Cal. 2001) (attempted taking of 99 Cents store to replace with a Costco); Poletown Neighborhood Council v. Detroit, 410 Mich. 616, 304 N. W. 2d 455 (1981) (taking a working-class, immigrant community in Detroit and giving it to a General Motors assembly plant), overruled by County of Wayne v. Hathcock, 471 Mich. 445, 684 N. W. 2d 765 (2004); Brief for Becket Fund for Religious Liberty as Amicus Curiae 4-11 (describing takings of religious institutions’ properties); Institute for Justice, D. Berliner, Public Power, Private Gain: A Five-Year, State-by-State Report Examining the Abuse of Eminent Domain (2003) (collecting accounts of economic development takings).

 

The Court also puts special emphasis on facts peculiar to this case: The NLDC’s plan is the product of a relatively careful deliberative process; it proposes to use eminent domain for a multipart, integrated plan rather than for isolated property transfer; it promises an array of incidental benefits (even esthetic ones), not just increased tax revenue; it comes on the heels of a legislative determination that New London is a depressed municipality. See, e. g., ante, at 487 (“[A] one-to-one transfer of property, executed outside the confines of an integrated development plan, is not presented in this case”). JUSTICE KENNEDY, too, takes great comfort in these facts. Ante, at 493 (concurring opinion). But none has legal significance to blunt the force of today’s holding. If legislative prognostications about the secondary public benefits of a new use can legitimate a taking, there is nothing in the Court’s rule or in JUSTICE KENNEDY’s gloss on that rule to prohibit property transfers generated with less care, that are less comprehensive, that happen to result from less elaborate process, whose only projected advantage is the incidence of higher taxes, or that hope to transform an already prosperous city into an even more prosperous one.

 

Finally, in a coda, the Court suggests that property owners should turn to the States, who may or may not choose to impose appropriate limits on economic development takings. Ante, at 489. This is an abdication of our responsibility. States play many important functions in our system of dual sovereignty, but compensating for our refusal to enforce properly the Federal Constitution (and a provision meant to curtail state action, no less) is not among them.

 

 

 

 

* * *

 

 

 

 

It was possible after Berman and Midkiff to imagine unconstitutional transfers from A to B. Those decisions endorsed government intervention when private property use had veered to such an extreme that the public was suffering as a consequence. Today nearly all real property is susceptible to condemnation on the Court’s theory. In the prescient words of a dissenter from the infamous decision in Poletown, “[n]ow that we have authorized local legislative bodies to decide that a different commercial or industrial use of property will produce greater public benefits than its present use, no homeowner’s, merchant’s or manufacturer’s property, however productive or valuable to its owner, is immune from condemnation for the benefit of other private interests that will put it to a ‘higher’ use.” 410 Mich., at 644-645, 304 N. W. 2d, at 464 (opinion of Fitzgerald, J.). This is why economic development takings “seriously jeopardiz[e] the security of all private property ownership.” Id., at 645, 304 N. W. 2d, at 465 (Ryan, J., dissenting).

 

Any property may now be taken for the benefit of another private party, but the fallout from this decision will not be random. The beneficiaries are likely to be those citizens with disproportionate influence and power in the political process, including large corporations and development firms. As for the victims, the government now has license to transfer property from those with fewer resources to those with more. The Founders cannot have intended this perverse result. “[T]hat alone is a just government,” wrote James Madison, “which impartially secures to every man, whatever is his own.” For the National Gazette, Property (Mar. 27, 1792), reprinted in 14 Papers of James Madison 266 (R. Rutland et al. eds. 1983).

 

I would hold that the takings in both Parcel 3 and Parcel 4A are unconstitutional, reverse the judgment of the Supreme Court of Connecticut, and remand for further proceedings.

 

 

 

Justice Thomas, dissenting.

 

 

 

Long ago, William Blackstone wrote that “the law of the land … postpone[s] even public necessity to the sacred and inviolable rights of private property.” 1 Commentaries on the Laws of England 134-135 (1765) (hereinafter Blackstone). The Framers embodied that principle in the Constitution, allowing the government to take property not for “public necessity,” but instead for “public use.” Amdt. 5. Defying this understanding, the Court replaces the Public Use Clause with a ”’[P]ublic [P]urpose’” Clause, ante, at 479-480 (or perhaps the “Diverse and Always Evolving Needs of Society” Clause, ante, at 479 (capitalization added)), a restriction that is satisfied, the Court instructs, so long as the purpose is “legitimate” and the means “not irrational,” ante, at 488 (internal quotation marks omitted). This deferential shift in phraseology enables the Court to hold, against all common sense, that a costly urban-renewal project whose stated purpose is a vague promise of new jobs and increased tax revenue, but which is also suspiciously agreeable to the Pfizer Corporation, is for a “public use.”

 

I cannot agree. If such “economic development” takings are for a “public use,” any taking is, and the Court has erased the Public Use Clause from our Constitution, as JUSTICE O’CONNOR powerfully argues in dissent. Ante, at 494, 501-505. I do not believe that this Court can eliminate liberties expressly enumerated in the Constitution and therefore join her dissenting opinion. Regrettably, however, the Court’s error runs deeper than this. Today’s decision is simply the latest in a string of our cases construing the Public Use Clause to be a virtual nullity, without the slightest nod to its original meaning. In my view, the Public Use Clause, originally understood, is a meaningful limit on the government’s eminent domain power. Our cases have strayed from the Clause’s original meaning, and I would reconsider them.

 

 

 

 

I

 

 

 

 

The Fifth Amendment provides:

 

 

“No person shall be held to answer for a capital, or otherwise infamous crime, unless on a presentment or indictment of a Grand Jury, except in cases arising in the land or naval forces, or in the Militia, when in actual service in time of War or public danger; nor shall any person be subject for the same offence to be twice put in jeopardy of life or limb, nor shall be compelled in any criminal case to be a witness against himself, nor be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.” (Emphasis added.)

 

 

It is the last of these liberties, the Takings Clause, that is at issue in this case. In my view, it is “imperative that the Court maintain absolute fidelity to” the Clause’s express limit on the power of the government over the individual, no less than with every other liberty expressly enumerated in the Fifth Amendment or the Bill of Rights more generally. Shepard v. United States, 544 U. S. 13, 28 (2005) (THOMAS, J., concurring in part and concurring in judgment) (internal quotation marks omitted).

 

Though one component of the protection provided by the Takings Clause is that the government can take private property only if it provides “just compensation” for the taking, the Takings Clause also prohibits the government from taking property except “for public use.” Were it otherwise, the Takings Clause would either be meaningless or empty. If the Public Use Clause served no function other than to state that the government may take property through its eminent domain power–for public or private uses–then it would be surplusage. See ante, at 496 (O’CONNOR, J., dissenting); see also Marbury v. Madison, 1 Cranch 137, 174 (1803) (“It cannot be presumed that any clause in the constitution is intended to be without effect”); Myers v. United States, 272 U. S. 52, 151 (1926). Alternatively, the Clause could distinguish those takings that require compensation from those that do not. That interpretation, however, “would permit private property to be taken or appropriated for private use without any compensation whatever.” Cole v. La Grange, 113 U. S. 1, 8 (1885) (interpreting same language in the Missouri Public Use Clause). In other words, the Clause would require the government to compensate for takings done “for public use,” leaving it free to take property for purely private uses without the payment of compensation. This would contradict a bedrock principle well established by the time of the founding: that all takings required the payment of compensation. 1 Blackstone 135; 2 J. Kent, Commentaries on American Law 275 (1827) (hereinafter Kent); For the National Gazette, Property (Mar. 27, 1792), in 14 Papers of James Madison 266, 267 (R. Rutland et al. eds. 1983) (arguing that no property “shall be taken directly even for public use without indemnification to the owner”).26 The Public Use Clause, like the Just Compensation Clause, is therefore an express limit on the government’s power of eminent domain.

 

The most natural reading of the Clause is that it allows the government to take property only if the government owns, or the public has a legal right to use, the property, as opposed to taking it for any public purpose or necessity whatsoever. At the time of the founding, dictionaries primarily defined the noun “use” as “[t]he act of employing any thing to any purpose.” 2 S. Johnson, A Dictionary of the English Language 2194 (4th ed. 1773) (hereinafter Johnson). The term “use,” moreover, “is from the Latin utor, which means ‘to use, make use of, avail one’s self of, employ, apply, enjoy, etc.” J. Lewis, Law of Eminent Domain § 165, p. 224, n. 4 (1888) (hereinafter Lewis). When the government takes property and gives it to a private individual, and the public has no right to use the property, it strains language to say that the public is “employing” the property, regardless of the incidental benefits that might accrue to the public from the private use. The term “public use,” then, means that either the government or its citizens as a whole must actually “employ” the taken property. See id., at 223 (reviewing founding-era dictionaries).

 

Granted, another sense of the word “use” was broader in meaning, extending to “[c]onvenience” or “help,” or “[q]ualities that make a thing proper for any purpose.” 2 Johnson 2194. Nevertheless, read in context, the term “public use” possesses the narrower meaning. Elsewhere, the Constitution twice employs the word “use,” both times in its narrower sense. Claeys, Public-Use Limitations and Natural Property Rights, 2004 Mich. St. L. Rev. 877, 897 (hereinafter Public Use Limitations). Article I, § 10, provides that “the net Produce of all Duties and Imposts, laid by any State on Imports or Exports, shall be for the Use of the Treasury of the United States,” meaning the Treasury itself will control the taxes, not use it to any beneficial end. And Article I, § 8, grants Congress power “[t]o raise and support Armies, but no Appropriation of Money to that Use shall be for a longer Term than two Years.” Here again, “use” means “employed to raise and support Armies,” not anything directed to achieving any military end. The same word in the Public Use Clause should be interpreted to have the same meaning.

 

Tellingly, the phrase “public use” contrasts with the very different phrase “general Welfare” used elsewhere in the Constitution. See ibid. (“Congress shall have Power To… provide for the common Defence and general Welfare of the United States”); preamble (Constitution established “to promote the general Welfare”). The Framers would have used some such broader term if they had meant the Public Use Clause to have a similarly sweeping scope. Other founding-era documents made the contrast between these two usages still more explicit. See Sales, Classical Republicanism and the Fifth Amendment’s “Public Use” Requirement, 49 Duke L. J. 339, 367-368 (1999) (hereinafter Sales) (noting contrast between, on the one hand, the term “public use” used by 6 of the first 13 States and, on the other, the terms “public exigencies” employed in the Massachusetts Bill of Rights and the Northwest Ordinance, and the term “public necessity” used in the Vermont Constitution of 1786). The Constitution’s text, in short, suggests that the Takings Clause authorizes the taking of property only if the public has a right to employ it, not if the public realizes any conceivable benefit from the taking.

 

The Constitution’s common-law background reinforces this understanding. The common law provided an express method of eliminating uses of land that adversely impacted the public welfare: nuisance law. Blackstone and Kent, for instance, both carefully distinguished the law of nuisance from the power of eminent domain. Compare 1 Blackstone 135 (noting government’s power to take private property with compensation) with 3 id., at 216 (noting action to remedy ”public … nuisances, which affect the public, and are an annoyance to all the king’s subjects”); see also 2 Kent 274-276 (distinguishing the two). Blackstone rejected the idea that private property could be taken solely for purposes of any public benefit. “So great … is the regard of the law for private property,” he explained, “that it will not authorize the least violation of it; no, not even for the general good of the whole community.” 1 Blackstone 135. He continued: “If a new road … were to be made through the grounds of a private person, it might perhaps be extensively beneficial to the public; but the law permits no man, or set of men, to do this without the consent of the owner of the land.” Ibid. Only “by giving [the landowner] full indemnification” could the government take property, and even then “[t]he public [was] now considered as an individual, treating with an individual for an exchange.” Ibid. When the public took property, in other words, it took it as an individual buying property from another typically would: for one’s own use. The Public Use Clause, in short, embodied the Framers’ understanding that property is a natural, fundamental right, prohibiting the government from “tak[ing] property from A. and giv[ing] it to B.” Calder v. Bull, 3 Dall. 386, 388 (1798); see also Wilkinson v. Leland, 2 Pet. 627, 658 (1829); Vanhorne’s Lessee v. Dorrance, 2 Dall. 304, 311 (CC Pa. 1795).

 

The public purpose interpretation of the Public Use Clause also unnecessarily duplicates a similar inquiry required by the Necessary and Proper Clause. The Takings Clause is a prohibition, not a grant of power: The Constitution does not expressly grant the Federal Government the power to take property for any public purpose whatsoever. Instead, the Government may take property only when necessary and proper to the exercise of an expressly enumerated power. See Kohl v. United States, 91 U. S. 367, 371-372 (1876) (noting Federal Government’s power under the Necessary and Proper Clause to take property “needed for forts, armories, and arsenals, for navy-yards and light-houses, for custom-houses, post-offices, and court-houses, and for other public uses”). For a law to be within the Necessary and Proper Clause, as I have elsewhere explained, it must bear an “obvious, simple, and direct relation” to an exercise of Congress’ enumerated powers, Sabri v. United States, 541 U. S. 600, 613 (2004) (THOMAS, J., concurring in judgment), and it must not “subvert basic principles of” constitutional design, Gonzales v. Raich, ante, at 65 (THOMAS, J., dissenting). In other words, a taking is permissible under the Necessary and Proper Clause only if it serves a valid public purpose. Interpreting the Public Use Clause likewise to limit the government to take property only for sufficiently public purposes replicates this inquiry. If this is all the Clause means, it is, once again, surplusage. See supra, at 507. The Clause is thus most naturally read to concern whether the property is used by the public or the government, not whether the purpose of the taking is legitimately public.

 

 

 

 

II

 

 

 

 

Early American eminent domain practice largely bears out this understanding of the Public Use Clause. This practice concerns state limits on eminent domain power, not the Fifth Amendment, since it was not until the late 19th century that the Federal Government began to use the power of eminent domain, and since the Takings Clause did not even arguably limit state power until after the passage of the Fourteenth Amendment. See Note, The Public Use Limitation on Eminent Domain: An Advance Requiem, 58 Yale L. J. 599, 599-600, and nn. 3-4 (1949); Barron ex rel. Tiernan v. Mayor of Baltimore, 7 Pet. 243, 250-251 (1833) (holding the Takings Clause inapplicable to the States of its own force). Nevertheless, several early state constitutions at the time of the founding likewise limited the power of eminent domain to “public uses.” See Sales 367-369, and n. 137 (emphasis deleted). Their practices therefore shed light on the original meaning of the same words contained in the Public Use Clause.

 

States employed the eminent domain power to provide quintessentially public goods, such as public roads, toll roads, ferries, canals, railroads, and public parks. Lewis §§ 166, 168-171, 175, at 227-228, 234-241, 243. Though use of the eminent domain power was sparse at the time of the founding, many States did have so-called Mill Acts, which authorized the owners of grist mills operated by water power to flood upstream lands with the payment of compensation to the upstream landowner. See, e. g., id., § 178, at 245-246; Head v. Amoskeag Mfg. Co., 113 U. S. 9, 16-19, and n. (1885). Those early grist mills “were regulated by law and compelled to serve the public for a stipulated toll and in regular order,” and therefore were actually used by the public. Lewis § 178, at 246, and n. 3; see also Head, supra, at 18-19. They were common carriers–quasi-public entities. These were “public uses” in the fullest sense of the word, because the public could legally use and benefit from them equally. See Public Use Limitations 903 (common-carrier status traditionally afforded to “private beneficiaries of a state franchise or another form of state monopoly, or to companies that operated in conditions of natural monopoly”).

 

To be sure, some early state legislatures tested the limits of their state-law eminent domain power. Some States enacted statutes allowing the taking of property for the purpose of building private roads. See Lewis § 167, at 230. These statutes were mixed; some required the private landowner to keep the road open to the public, and others did not. See id., § 167, at 230-234. Later in the 19th century, moreover, the Mill Acts were employed to grant rights to private manufacturing plants, in addition to grist mills that had common-carrier duties. See, e. g., M. Horwitz, The Transformation of American Law 1780-1860, pp. 51-52 (1977).

 

These early uses of the eminent domain power are often cited as evidence for the broad “public purpose” interpretation of the Public Use Clause, see, e. g., ante, at 479-480, n. 8 (majority opinion); Brief for Respondents 30; Brief for American Planning Assn. et al. as Amici Curiae 6-7, but in fact the constitutionality of these exercises of eminent domain power under state public use restrictions was a hotly contested question in state courts throughout the 19th and into the 20th century. Some courts construed those clauses to authorize takings for public purposes, but others adhered to the natural meaning of “public use.”27 As noted above, the earliest Mill Acts were applied to entities with duties to remain open to the public, and their later extension is not deeply probative of whether that subsequent practice is consistent with the original meaning of the Public Use Clause. See McIntyre v. Ohio Elections Comm’n, 514 U. S. 334, 370 (1995) (THOMAS, J., concurring in judgment). At the time of the founding, “[b]usiness corporations were only beginning to upset the old corporate model, in which the raison d’être of chartered associations was their service to the public,” Horwitz, supra, at 49-50, so it was natural to those who framed the first Public Use Clauses to think of mills as inherently public entities. The disagreement among state courts, and state legislatures’ attempts to circumvent public use limits on their eminent domain power, cannot obscure that the Public Use Clause is most naturally read to authorize takings for public use only if the government or the public actually uses the taken property.

 

 

 

 

III

 

 

 

 

Our current Public Use Clause jurisprudence, as the Court notes, has rejected this natural reading of the Clause. Ante, at 479-483. The Court adopted its modern reading blindly, with little discussion of the Clause’s history and original meaning, in two distinct lines of cases: first, in cases adopting the “public purpose” interpretation of the Clause, and second, in cases deferring to legislatures’ judgments regarding what constitutes a valid public purpose. Those questionable cases converged in the boundlessly broad and deferential conception of “public use” adopted by this Court in Berman v. Parker, 348 U. S. 26 (1954), and Hawaii Housing Authority v. Midkiff, 467 U. S. 229 (1984), cases that take center stage in the Court’s opinion. See ante, at 480-482. The weakness of those two lines of cases, and consequently Berman and Midkiff, fatally undermines the doctrinal foundations of the Court’s decision. Today’s questionable application of these cases is further proof that the “public purpose” standard is not susceptible of principled application. This Court’s reliance by rote on this standard is ill advised and should be reconsidered.

 

 

 

 

A

 

 

 

 

As the Court notes, the “public purpose” interpretation of the Public Use Clause stems from Fallbrook Irrigation Dist. v. Bradley, 164 U. S. 112, 161-162 (1896). Ante, at 479-480. The issue in Bradley was whether a condemnation for purposes of constructing an irrigation ditch was for a public use. 164 U. S., at 161. This was a public use, Justice Peckham declared for the Court, because “[t]o irrigate and thus to bring into possible cultivation these large masses of otherwise worthless lands would seem to be a public purpose and a matter of public interest, not confined to landowners, or even to any one section of the State.” Ibid. That broad statement was dictum, for the law under review also provided that “[a]ll landowners in the district have the right to a proportionate share of the water.” Id., at 162. Thus, the “public” did have the right to use the irrigation ditch because all similarly situated members of the public–those who owned lands irrigated by the ditch–had a right to use it. The Court cited no authority for its dictum, and did not discuss either the Public Use Clause’s original meaning or the numerous authorities that had adopted the “actual use” test (though it at least acknowledged the conflict of authority in state courts, see id., at 158; supra, at 513-514, and n. 2). Instead, the Court reasoned that “[t]he use must be regarded as a public use, or else it would seem to follow that no general scheme of irrigation can be formed or carried into effect.” Bradley, supra, at 160-161. This is no statement of constitutional principle: Whatever the utility of irrigation districts or the merits of the Court’s view that another rule would be “impractical given the diverse and always evolving needs of society,” ante, at 479, the Constitution does not embody those policy preferences any more than it “enact[s] Mr. Herbert Spencer’s Social Statics,” >Lochner v. New York, 198 U. S. 45, 75 (1905) (Holmes, J., dissenting); but see id., at 58-62 (Peckham, J., for the Court).

 

This Court’s cases followed Bradley’s test with little analysis. In Clark v. Nash, 198 U. S. 361 (1905) (Peckham, J., for the Court), this Court relied on little more than a citation to Bradley in upholding another condemnation for the purpose of laying an irrigation ditch. 198 U. S., at 369-370. As in Bradley, use of the “public purpose” test was unnecessary to the result the Court reached. The government condemned the irrigation ditch for the purpose of ensuring access to water in which “[o]ther land owners adjoining the defendant in error … might share,” 198 U. S., at 370, and therefore Clark also involved a condemnation for the purpose of ensuring access to a resource to which similarly situated members of the public had a legal right of access. Likewise, in Strickley v. Highland Boy Gold Mining Co., 200 U. S. 527 (1906), the Court upheld a condemnation establishing an aerial right-of-way for a bucket line operated by a mining company, relying on little more than Clark, see Strickley, supra, at 531. This case, too, could have been disposed of on the narrower ground that “the plaintiff [was] a carrier for itself and others,” 200 U. S., at 531-532, and therefore that the bucket line was legally open to the public. Instead, the Court unnecessarily rested its decision on the “inadequacy of use by the general public as a universal test.” Id., at 531. This Court’s cases quickly incorporated the public purpose standard set forth in Clark and Strickley by barren citation. See, e. g., Rindge Co. v. County of Los Angeles, 262 U. S. 700, 707 (1923); Block v. Hirsh, 256 U. S. 135, 155 (1921); Mt. Vernon-Woodberry Cotton Duck Co. v. Alabama Interstate Power Co., 240 U. S. 30, 32 (1916); O’Neill v. Leamer, 239 U. S. 244, 253 (1915).

 

 

 

 

B

 

 

 

 

A second line of this Court’s cases also deviated from the Public Use Clause’s original meaning by allowing legislatures to define the scope of valid “public uses.” United States v. Gettysburg Electric R. Co., 160 U. S. 668 (1896), involved the question whether Congress’ decision to condemn certain private land for the purpose of building battlefield memorials at Gettysburg, Pennsylvania, was for a public use. Id., at 679-680. Since the Federal Government was to use the lands in question, id., at 682, there is no doubt that it was a public use under any reasonable standard. Nonetheless, the Court, speaking through Justice Peckham, declared that “when the legislature has declared the use or purpose to be a public one, its judgment will be respected by the courts, unless the use be palpably without reasonable foundation.” Id., at 680. As it had with the “public purpose” dictum in Bradley, the Court quickly incorporated this dictum into its Public Use Clause cases with little discussion. See, e. g., United States ex rel. TVA v. Welch, 327 U. S. 546, 552 (1946); Old Dominion Land Co. v. United States, 269 U. S. 55, 66 (1925).

 

There is no justification, however, for affording almost insurmountable deference to legislative conclusions that a use serves a “public use.” To begin with, a court owes no deference to a legislature’s judgment concerning the quintessentially legal question of whether the government owns, or the public has a legal right to use, the taken property. Even under the “public purpose” interpretation, moreover, it is most implausible that the Framers intended to defer to legislatures as to what satisfies the Public Use Clause, uniquely among all the express provisions of the Bill of Rights. We would not defer to a legislature’s determination of the various circumstances that establish, for example, when a search of a home would be reasonable, see, e. g., Payton v. New York, 445 U. S. 573, 589-590 (1980), or when a convicted double-murderer may be shackled during a sentencing proceeding without on-the-record findings, see Deck v. Missouri, 544 U. S. 622 (2005), or when state law creates a property interest protected by the Due Process Clause, see, e. g., Castle Rock v. Gonzales, post, at 756-758; Board of Regents of State Colleges v. Roth, 408 U. S. 564, 576 (1972); Goldberg v. Kelly, 397 U. S. 254, 262-263 (1970).

 

Still worse, it is backwards to adopt a searching standard of constitutional review for nontraditional property interests, such as welfare benefits, see, e. g., Goldberg, supra, while deferring to the legislature’s determination as to what constitutes a public use when it exercises the power of eminent domain, and thereby invades individuals’ traditional rights in real property. The Court has elsewhere recognized “the overriding respect for the sanctity of the home that has been embedded in our traditions since the origins of the Republic,” Payton, supra, at 601, when the issue is only whether the government may search a home. Yet today the Court tells us that we are not to “second-guess the City’s considered judgments,” ante, at 488, when the issue is, instead, whether the government may take the infinitely more intrusive step of tearing down petitioners’ homes. Something has gone seriously awry with this Court’s interpretation of the Constitution. Though citizens are safe from the government in their homes, the homes themselves are not. Once one accepts, as the Court at least nominally does, ante, at 477, that the Public Use Clause is a limit on the eminent domain power of the Federal Government and the States, there is no justification for the almost complete deference it grants to legislatures as to what satisfies it.

 

 

 

 

C

 

 

 

 

These two misguided lines of precedent converged in Berman v. Parker, 348 U. S. 26 (1954), and Hawaii Housing Authority v. Midkiff, 467 U. S. 229 (1984). Relying on those lines of cases, the Court in Berman and Midkiff upheld condemnations for the purposes of slum clearance and land redistribution, respectively. “Subject to specific constitutional limitations,” Berman proclaimed, “when the legislature has spoken, the public interest has been declared in terms wellnigh conclusive. In such cases the legislature, not the judiciary, is the main guardian of the public needs to be served by social legislation.” 348 U. S., at 32. That reasoning was question begging, since the question to be decided was whether the “specific constitutional limitation” of the Public Use Clause prevented the taking of the appellant’s (concededly “nonblighted”) department store. Id., at 31, 34. Berman also appeared to reason that any exercise by Congress of an enumerated power (in this case, its plenary power over the District of Columbia) was per se a “public use” under the Fifth Amendment. Id., at 33. But the very point of the Public Use Clause is to limit that power. See supra, at 508.

 

More fundamentally, Berman and Midkiff erred by equating the eminent domain power with the police power of States. See Midkiff, supra, at 240 (“The ‘public use’ requirement is … coterminous with the scope of a sovereign’s police powers”); Berman, supra, at 32. Traditional uses of that regulatory power, such as the power to abate a nuisance, required no compensation whatsoever, see Mugler v. Kansas, 123 U. S. 623, 668-669 (1887), in sharp contrast to the takings power, which has always required compensation, see supra, at 508, and n. 1. The question whether the State can take property using the power of eminent domain is therefore distinct from the question whether it can regulate property pursuant to the police power. See, e. g., Lucas v. South Carolina Coastal Council, 505 U. S. 1003, 1014 (1992); Mugler, supra, at 668-669. In Berman, for example, if the slums at issue were truly “blighted,” then state nuisance law, see, e. g., supra, at 510; Lucas, supra, at 1029, not the power of eminent domain, would provide the appropriate remedy. To construe the Public Use Clause to overlap with the States’ police power conflates these two categories.28

 

The “public purpose” test applied by Berman and Midkiff also cannot be applied in principled manner. “When we depart from the natural import of the term ‘public use,’ and substitute for the simple idea of a public possession and occupation, that of public utility, public interest, common benefit, general advantage or convenience … we are afloat without any certain principle to guide us.” Bloodgood v. Mohawk & Hudson R. Co., 18 Wend. 9, 60-61 (NY 1837) (opinion of Tracy, Sen.). Once one permits takings for public purposes in addition to public uses, no coherent principle limits what could constitute a valid public use–at least, none beyond JUSTICE O’CONNOR’s (entirely proper) appeal to the text of the Constitution itself. See ante, at 494, 501-505 (dissenting opinion). I share the Court’s skepticism about a public use standard that requires courts to second-guess the policy wisdom of public works projects. Ante, at 486-489. The “public purpose” standard this Court has adopted, however, demands the use of such judgment, for the Court concedes that the Public Use Clause would forbid a purely private taking. Ante, at 477-478. It is difficult to imagine how a court could find that a taking was purely private except by determining that the taking did not, in fact, rationally advance the public interest. Cf. ante, at 502-503 (O’CONNOR, J., dissenting) (noting the complicated inquiry the Court’s test requires). The Court is therefore wrong to criticize the “actual use” test as “difficult to administer.” Ante, at 479. It is far easier to analyze whether the government owns or the public has a legal right to use the taken property than to ask whether the taking has a “purely private purpose”–unless the Court means to eliminate public use scrutiny of takings entirely. Ante, at 477-478, 488-489. Obliterating a provision of the Constitution, of course, guarantees that it will not be misapplied.

 

For all these reasons, I would revisit our Public Use Clause cases and consider returning to the original meaning of the Public Use Clause: that the government may take property only if it actually uses or gives the public a legal right to use the property.

 

 

 

 

IV

 

 

 

 

The consequences of today’s decision are not difficult to predict, and promise to be harmful. So-called “urban renewal” programs provide some compensation for the properties they take, but no compensation is possible for the subjective value of these lands to the individuals displaced and the indignity inflicted by uprooting them from their homes. Allowing the government to take property solely for public purposes is bad enough, but extending the concept of public purpose to encompass any economically beneficial goal guarantees that these losses will fall disproportionately on poor communities. Those communities are not only systematically less likely to put their lands to the highest and best social use, but are also the least politically powerful. If ever there were justification for intrusive judicial review of constitutional provisions that protect “discrete and insular minorities,” United States v. Carolene Products Co., 304 U. S. 144, 152, n. 4 (1938), surely that principle would apply with great force to the powerless groups and individuals the Public Use Clause protects. The deferential standard this Court has adopted for the Public Use Clause is therefore deeply perverse. It encourages “those citizens with disproportionate influence and power in the political process, including large corporations and development firms,” to victimize the weak. Ante, at 505 (O’CONNOR, J., dissenting).

 

Those incentives have made the legacy of this Court’s “public purpose” test an unhappy one. In the 1950’s, no doubt emboldened in part by the expansive understanding of “public use” this Court adopted in Berman, cities “rushed to draw plans” for downtown development. B. Frieden & L. Sagalyn, Downtown, Inc. How America Rebuilds Cities 17 (1989). “Of all the families displaced by urban renewal from 1949 through 1963, 63 percent of those whose race was known were nonwhite, and of these families, 56 percent of nonwhites and 38 percent of whites had incomes low enough to qualify for public housing, which, however, was seldom available to them.” Id., at 28. Public works projects in the 1950’s and 1960’s destroyed predominantly minority communities in St. Paul, Minnesota, and Baltimore, Maryland. Id., at 28-29. In 1981, urban planners in Detroit, Michigan, uprooted the largely “lower-income and elderly” Poletown neighborhood for the benefit of the General Motors Corporation. J. Wylie, Poletown: Community Betrayed 58 (1989). Urban renewal projects have long been associated with the displacement of blacks; “[i]n cities across the country, urban renewal came to be known as ‘Negro removal.’” Pritchett, The “Public Menace” of Blight: Urban Renewal and the Private Uses of Eminent Domain, 21 Yale L. & Pol’y Rev. 1, 47 (2003). Over 97 percent of the individuals forcibly removed from their homes by the “slum-clearance” project upheld by this Court in Berman were black. 348 U. S., at 30. Regrettably, the predictable consequence of the Court’s decision will be to exacerbate these effects.

 

 

 

 

* * *

 

 

 

 

The Court relies almost exclusively on this Court’s prior cases to derive today’s far-reaching, and dangerous, result. See ante, at 479-483. But the principles this Court should employ to dispose of this case are found in the Public Use Clause itself, not in Justice Peckham’s high opinion of reclamation laws, see supra, at 515-516. When faced with a clash of constitutional principle and a line of unreasoned cases wholly divorced from the text, history, and structure of our founding document, we should not hesitate to resolve the tension in favor of the Constitution’s original meaning. For the reasons I have given, and for the reasons given in JUSTICE O’CONNOR’s dissent, the conflict of principle raised by this boundless use of the eminent domain power should be resolved in petitioners’ favor. I would reverse the judgment of the Connecticut Supreme Court.

 


    1. Briefs of amici curiae urging reversal were filed for the American Farm Bureau Federation et al. by Michael M. Berger, Nancy McDonough, and Gideon Kanner; for America’s Future, Inc., et al. by Andrew L. Schlafly; for the Becket Fund for Religious Liberty by Anthony R. Picarello, Jr., and Roman P. Storzer; for the Better Government Association et al. by Barry Levenstam and Jeremy M. Taylor; for the Cascade Policy Institute et al. by James L. Huffman; for the Cato Institute by Richard A. Epstein, Timothy Lynch, and Robert A. Levy; for the Claremont Institute Center for Constitutional Jurisprudence by John C. Eastman; for Develop Don’t Destroy (Brooklyn), Inc., et al. by Norman Siegel and Steven Hyman; for the Goldwater Institute et al. by Mark Brnovich; for King Ranch, Inc., by Michael Austin Hatchell and William Scott Hastings; for the Mountain States Legal Foundation et al. by William Perry Pendley and Joseph F. Becker; for the National Association for the Advancement of Colored People et al. by Jason M. Freier, Dennis Courtland Hayes, Michael Schuster, and Douglas E. Gershuny; for the National Association of Home Builders et al. by Mary Lynn Pickel, John J. Delaney, Laurene K. Janik, and Ralph W. Holmen; for New London Landmarks, Inc., et al. by Michael E. Malamut, Andrew R. Grainger, and Martin J. Newhouse; for the New London R. R. Co., Inc., by Michael D. O’Connell; for the Property Rights Foundation of America, Inc., by H. Christopher Bartolomucci and Jonathan L. Abram; for the Reason Foundation by Mark A. Perry and Thomas H. Dupree, Jr.; for the Rutherford Institute by John W. Whitehead; for the Tidewater Libertarian Party by Stephen Merrill; for David L. Callies et al. by Mr. Callies, pro se; for Mary Bugryn Dudko et al. by James S. Burling; for Jane Jacobs by Robert S. Getman; for Laura B. Kohr et al. by Joel R. Burcat and John C. Snyder; for John Norquist by Frank Schnidman; and for Robert Nigel Richards et al. by Kenneth R. Kupchak and Robert H. Thomas.

       

      Briefs of amici curiae urging affirmance were filed for the State of Connecticut by Richard Blumenthal, Attorney General, and Robert D. Snook, Assistant Attorney General; for the State of Vermont et al. by William H. Sorrell, Attorney General of Vermont, and Bridget C. Asay and S. Mark Sciarrotta, Assistant Attorneys General, and by the Attorneys General for their respective jurisdictions as follows: M. Jane Brady of Delaware, Robert J. Spagnoletti of the District of Columbia, Mark J. Bennett of Hawaii, Lisa Madigan of Illinois, J. Joseph Curran, Jr., of Maryland, Mike McGrath of Montana, Eliot Spitzer of New York, W. A. Drew Edmondson of Oklahoma, Hardy Myers of Oregon, Patrick C. Lynch of Rhode Island, Lawrence E. Long of South Dakota, and Paul G. Summers of Tennessee; for the American Planning Association et al. by Thomas W. Merrill and John D. Echeverria; for Brooklyn United for Innovative Local Development (BUILD) et al. by David T. Goldberg and Sean H. Donahue; for the California Redevelopment Association by Iris P. Yang; for the City of New York by Michael A. Cardozo, Leonard J. Koerner, Edward F. X. Hart, and Jane L. Gordon; for the Connecticut Conference of Municipalities et al. by Allan B. Taylor and Michael P. Shea; for the K. Hovnanian Companies, LLC, by Paul H. Schneider; for the Massachusetts Chapter of the National Association of Industrial and Office Properties by R. Jeffrey Lyman and Richard A. Oetheimer; for the Mayor and City Council of Baltimore by Ralph S. Tyler III; for the National League of Cities et al. by Richard Ruda, Timothy J. Dowling, and J. Peter Byrne; for the New York State Urban Development Corp. d/b/a Empire State Development Corp. by Joseph M. Ryan, John R. Casolaro, Susan B. Kalib, and Jack Kaplan; and for Robert H. Freilich et al. by Mr. Freilich, pro se.

 

    1. “[N]or shall private property be taken for public use, without just compensation.” U. S. Const., Amdt. 5. That Clause is made applicable to the States by the Fourteenth Amendment. See Chicago, B. & Q. R. Co. v. Chicago, 166 U. S. 226 (1897).

 

    1. Various state agencies studied the project’s economic, environmental, and social ramifications. As part of this process, a team of consultants evaluated six alternative development proposals for the area, which varied in extensiveness and emphasis. The Office of Policy and Management, one of the primary state agencies undertaking the review, made findings that the project was consistent with relevant state and municipal development policies. See App. 89-95.

 

    1. In the remainder of the opinion we will differentiate between the City and the NLDC only where necessary.

 

    1. While this litigation was pending before the Superior Court, the NLDC announced that it would lease some of the parcels to private developers in exchange for their agreement to develop the land according to the terms of the development plan. Specifically, the NLDC was negotiating a 99-year ground lease with Corcoran Jennison, a developer selected from a group of applicants. The negotiations contemplated a nominal rent of $1 per year, but no agreement had yet been signed. See 268 Conn. 1, 9, 61, 843 A. 2d 500, 509-510, 540 (2004).

 

    1. See also Calder v. Bull, 3 Dall. 386, 388 (1798) (“An ACT of the Legislature (for I cannot call it a law) contrary to the great first principles of the social compact, cannot be considered a rightful exercise of legislative authority… . A few instances will suffice to explain what I mean… . [A] law that takes property from A. and gives it to B: It is against all reason and justice, for a people to entrust a Legislature with SUCH powers; and, therefore, it cannot be presumed that they have done it. The genius, the nature, and the spirit, of our State Governments, amount to a prohibition of such acts of legislation; and the general principles of law and reason forbid them” (emphasis deleted)).

 

    1. See 268 Conn., at 159, 843 A. 2d, at 595 (Zarella, J., concurring in part and dissenting in part) (“The record clearly demonstrates that the development plan was not intended to serve the interests of Pfizer, Inc., or any other private entity, but rather, to revitalize the local economy by creating temporary and permanent jobs, generating a significant increase in tax revenue, encouraging spin-off economic activities and maximizing public access to the waterfront”). And while the City intends to transfer certain of the parcels to a private developer in a long-term lease–which developer, in turn, is expected to lease the office space and so forth to other private tenants–the identities of those private parties were not known when the plan was adopted. It is, of course, difficult to accuse the government of having taken A’s property to benefit the private interests of B when the identity of B was unknown.

 

    1. See, e. g., Dayton Gold & Silver Mining Co. v. Seawell, 11 Nev. 394, 410, 1876 WL 4573, *11 (1876) (“If public occupation and enjoyment of the object for which land is to be condemned furnishes the only and true test for the right of eminent domain, then the legislature would certainly have the constitutional authority to condemn the lands of any private citizen for the purpose of building hotels and theaters. Why not? A hotel is used by the public as much as a railroad. The public have the same right, upon payment of a fixed compensation, to seek rest and refreshment at a public inn as they have to travel upon a railroad”).

 

    1. From upholding the Mill Acts (which authorized manufacturers dependent on power-producing dams to flood upstream lands in exchange for just compensation), to approving takings necessary for the economic development of the West through mining and irrigation, many state courts either circumvented the “use by the public” test when necessary or abandoned it completely. See Nichols, The Meaning of Public Use in the Law of Eminent Domain, 20 B. U. L. Rev. 615, 619-624 (1940) (tracing this development and collecting cases). For example, in rejecting the “use by the public” test as overly restrictive, the Nevada Supreme Court stressed that “[m]ining is the greatest of the industrial pursuits in this state. All other interests are subservient to it. Our mountains are almost barren of timber, and our valleys could never be made profitable for agricultural purposes except for the fact of a home market having been created by the mining developments in different sections of the state. The mining and milling interests give employment to many men, and the benefits derived from this business are distributed as much, and sometimes more, among the laboring classes than with the owners of the mines and mills… . The present prosperity of the state is entirely due to the mining developments already made, and the entire people of the state are directly interested in having the future developments unobstructed by the obstinate action of any individual or individuals.” Dayton Gold & Silver Mining Co., 11 Nev., at 409-410, 1876 WL, at *11.

 

    1. See also Clark v. Nash, 198 U. S. 361 (1905) (upholding a statute that authorized the owner of arid land to widen a ditch on his neighbor’s property so as to permit a nearby stream to irrigate his land).

 

    1. See, e. g., Mt. Vernon-Woodberry Cotton Duck Co. v. Alabama Interstate Power Co., 240 U. S. 30, 32 (1916)(“The inadequacy of use by the general public as a universal test is established”); Ruckelshaus v. Monsanto Co., 467 U. S. 986, 1014-1015 (1984) (“This Court, however, has rejected the notion that a use is a public use only if the property taken is put to use for the general public”).

 

    1. See also Clark, 198 U. S., at 367-368; Strickley v. Highland Boy Gold Mining Co., 200 U. S. 527, 531 (1906) (“In the opinion of the legislature and the Supreme Court of Utah the public welfare of that State demands that aerial lines between the mines upon its mountain sides and railways in the valleys below should not be made impossible by the refusal of a private owner to sell the right to cross his land. The Constitution of the United States does not require us to say that they are wrong”); O’Neill v. Leamer, 239 U. S. 244, 253 (1915) (“States may take account of their special exigencies, and when the extent of their arid or wet lands is such that a plan for irrigation or reclamation according to districts may fairly be regarded as one which promotes the public interest, there is nothing in the Federal Constitution which denies to them the right to formulate this policy or to exercise the power of eminent domain in carrying it into effect. With the local situation the state court is peculiarly familiar and its judgment is entitled to the highest respect”).

 

    1. Cf. Village of Euclid v. Ambler Realty Co., 272 U. S. 365 (1926).

 

    1. It is a misreading of Berman to suggest that the only public use upheld in that case was the initial removal of blight. See Reply Brief for Petitioners 8. The public use described in Berman extended beyond that to encompass the purpose of developing that area to create conditions that would prevent a reversion to blight in the future. See 348 U. S., at 34-35 (“It was not enough, [the experts] believed, to remove existing buildings that were insanitary or unsightly. It was important to redesign the whole area so as to eliminate the conditions that cause slums… . The entire area needed redesigning so that a balanced, integrated plan could be developed for the region, including not only new homes, but also schools, churches, parks, streets, and shopping centers. In this way it was hoped that the cycle of decay of the area could be controlled and the birth of future slums prevented”). Had the public use in Berman been defined more narrowly, it would have been difficult to justify the taking of the plaintiff’s nonblighted department store.

 

    1. Any number of cases illustrate that the achievement of a public good often coincides with the immediate benefiting of private parties. See, e. g., National Railroad Passenger Corporation v. Boston & Maine Corp., 503 U. S. 407, 422 (1992) (public purpose of “facilitating Amtrak’s rail service” served by taking rail track from one private company and transferring it to another private company); Brown v. Legal Foundation of Wash., 538 U. S. 216 (2003)(provision of legal services to the poor is a valid public purpose). It is worth noting that in Hawaii Housing Authority v. Midkiff, 467 U. S. 229 (1984), Monsanto, and Boston & Maine Corp., the property in question retained the same use even after the change of ownership.

 

    1. Notably, as in the instant case, the private developers in Berman were required by contract to use the property to carry out the redevelopment plan. See 348 U. S., at 30.

 

    1. Nor do our cases support JUSTICE O’CONNOR’s novel theory that the government may only take property and transfer it to private parties when the initial taking eliminates some “harmful property use.” Post, at 501 (dissenting opinion). There was nothing “harmful” about the nonblighted department store at issue in Berman, 348 U. S. 26; see also n. 13, supra; nothing “harmful” about the lands at issue in the mining and agriculture cases, see, e. g., Strickley, 200 U. S. 527; see also nn. 9, 11, supra; and certainly nothing “harmful” about the trade secrets owned by the pesticide manufacturers in Monsanto, 467 U. S. 986. In each case, the public purpose we upheld depended on a private party’s future use of the concededly nonharmful property that was taken. By focusing on a property’s future use, as opposed to its past use, our cases are faithful to the text of the Takings Clause. See U. S. Const., Amdt. 5 (“[N]or shall private property be taken for public use, without just compensation”). JUSTICE O’CONNOR’s intimation that a “public purpose” may not be achieved by the action of private parties, see post, at 500-501, confuses the purpose of a taking with its mechanics, a mistake we warned of in Midkiff, 467 U. S., at 244. See also Berman, 348 U. S., at 33-34 (“The public end may be as well or better served through an agency of private enterprise than through a department of government”).

 

    1. Courts have viewed such aberrations with a skeptical eye. See, e. g., 99 Cents Only Stores v. Lancaster Redevelopment Agency, 237 F. Supp. 2d 1123 (CD Cal. 2001); cf. Cincinnati v. Vester, 281 U. S. 439, 448 (1930) (taking invalid under state eminent domain statute for lack of a reasoned explanation). These types of takings may also implicate other constitutional guarantees. See Village of Willowbrook v. Olech, 528 U. S. 562 (2000) (per curiam)

 

    1. Cf. Panhandle Oil Co. v. Mississippi ex rel. Knox, 277 U. S. 218, 223 (1928) (Holmes, J., dissenting) (“The power to tax is not the power to destroy while this Court sits”).

 

    1. A parade of horribles is especially unpersuasive in this context, since the Takings Clause largely “operates as a conditional limitation, permitting the government to do what it wants so long as it pays the charge.” Eastern Enterprises v. Apfel, 524 U. S. 498, 545 (1998) (Kennedy, J., concurring in judgment and dissenting in part). Speaking of the takings power, Justice Iredell observed that “[i]t is not sufficient to urge, that the power may be abused, for, such is the nature of all power,–such is the tendency of every human institution: and, it might as fairly be said, that the power of taxation, which is only circumscribed by the discretion of the Body, in which it is vested, ought not to be granted, because the Legislature, disregarding its true objects, might, for visionary and useless projects, impose a tax to the amount of nineteen shillings in the pound. We must be content to limit power where we can, and where we cannot, consistently with its use, we must be content to repose a salutory confidence.” Calder, 3 Dall., at 400 (opinion concurring in result).

 

    1. See also Boston & Maine Corp., 503 U. S., at 422-423(“[W]e need not make a specific factual determination whether the condemnation will accomplish its objectives”); Monsanto, 467 U. S., at 1015, n. 18 (“Monsanto argues that EPA and, by implication, Congress, misapprehended the true ‘barriers to entry’ in the pesticide industry and that the challenged provisions of the law create, rather than reduce, barriers to entry… . Such economic arguments are better directed to Congress. The proper inquiry before this Court is not whether the provisions in fact will accomplish their stated objectives. Our review is limited to determining that the purpose is legitimate and that Congress rationally could have believed that the provisions would promote that objective”).

 

    1. The amici raise questions about the fairness of the measure of just compensation. See, e. g., Brief for American Planning Association et al. as Amici Curiae 26-30. While important, these questions are not before us in this litigation.

 

    1. See, e. g., County of Wayne v. Hathcock, 471 Mich. 445, 684 N. W. 2d 765 (2004).

 

    1. Under California law, for instance, a city may only take land for economic development purposes in blighted areas. Cal. Health & Safety Code Ann. §§33030-33037 (West 1999). See, e. g., Redevelopment Agency of Chula Vista v. Rados Bros., 95 Cal. App. 4th 309, 115 Cal. Rptr. 2d 234 (2002).

 

    1. For example, some argue that the need for eminent domain has been greatly exaggerated because private developers can use numerous techniques, including secret negotiations or precommitment strategies, to overcome holdout problems and assemble lands for genuinely profitable projects. See Brief for Jane Jacobs as Amicus Curiae 13-15; see also Brief for John Norquist as Amicus Curiae. Others argue to the contrary, urging that the need for eminent domain is especially great with regard to older, small cities like New London, where centuries of development have created an extreme overdivision of land and thus a real market impediment to land assembly. See Brief for Connecticut Conference of Municipalities et al. as Amici Curiae 13, 21; see also Brief for National League of Cities et al. as Amici Curiae.

 

    1. Some state constitutions at the time of the founding lacked just compensation clauses and took property even without providing compensation. See Lucas v. South Carolina Coastal Council, 505 U. S. 1003, 1056-1057 (1992) (Blackmun, J., dissenting). The Framers of the Fifth Amendment apparently disagreed, for they expressly prohibited uncompensated takings, and the Fifth Amendment was not incorporated against the States until much later. See id., at 1028, n. 15.

 

    1. Compare ante, at 479, and n. 8 (majority opinion) (noting that some state courts upheld the validity of applying the Mill Acts to private purposes and arguing that the “‘use by the public’ test” “eroded over time”), with, e. g., Ryerson v. Brown, 35 Mich. 333, 338-339 (1877) (holding it “essential” to the constitutionality of a Mill Act “that the statute should require the use to be public in fact; in other words, that it should contain provisions entitling the public to accommodations”); Gaylord v. Sanitary Dist. of Chicago, 204 Ill. 576, 581-584, 68 N. E. 522, 524 (1903) (same); Tyler v. Beacher, 44 Vt. 648, 652-656 (1871) (same); Sadler v. Langham, 34 Ala. 311, 332-334 (1859) (striking down taking for purely private road and grist mill); Varner v. Martin, 21 W. Va. 534, 546-548, 556-557, 566-567 (1883) (grist mill and private road had to be open to public for them to constitute public use); Harding v. Goodlett, 3 Yer. 41, 53 (Tenn. 1832); Jacobs v. Clearview Water Supply Co., 220 Pa. 388, 393-395, 69 A. 870, 872 (1908) (endorsing actual public use standard); Minnesota Canal & Power Co. v. Koochiching Co., 97 Minn. 429, 449-451, 107 N. W. 405, 413 (1906) (same); Chesapeake Stone Co. v. Moreland, 126 Ky. 656, 663-667, 104 S. W. 762, 765 (Ct. App. 1907) (same); Note, Public Use in Eminent Domain, 21 N. Y. U. L. Q. Rev. 285, 286, and n. 11 (1946) (calling the actual public use standard the “majority view” and citing other cases).

 

    1. Some States also promoted the alienability of property by abolishing the feudal “quit rent” system, i. e., long-term leases under which the proprietor reserved to himself the right to perpetual payment of rents from his tenant. See Vance, The Quest for Tenure in the United States, 33 Yale L. J. 248, 256-257, 260-263 (1923). In Hawaii Housing Authority v. Midkiff, 467 U. S. 229 (1984), the Court cited those state policies favoring the alienability of land as evidence that the government’s eminent domain power was similarly expansive, see id., at 241-242, and n. 5. But they were uses of the States’ regulatory power, not the takings power, and therefore were irrelevant to the issue in Midkiff. This mismatch underscores the error of conflating a State’s regulatory power with its takings power.

 

 

 

 

 

7.4.2. Regulatory Takings

 

7.4.2.1. Ad hoc Takings

 

Pennsylvania Coal Company v. Mahon,

260 U.S. 393 (1922)

 

 

 

Mr. Justice Holmes delivered the opinion of the Court.

 

 

 

This is a bill in equity brought by the defendants in error to prevent the Pennsylvania Coal Company from mining under their property in such way as to remove the supports and cause a subsidence of the surface and of their house. The bill sets out a deed executed by the Coal Company in 1878, under which the plaintiffs claim. The deed conveys the surface, but in express terms reserves the right to remove all the coal under the same, and the grantee takes the premises with the risk, and waives all claim for damages that may arise from mining out the coal. But the plaintiffs say that whatever may have been the Coal Company’s rights, they were taken away by an Act of Pennsylvania, approved May 27, 1921, P.L. 1198, commonly known there as the Kohler Act. The Court of Common Pleas found that if not restrained the defendant would cause the damage to prevent which the bill was brought, but denied an injunction, holding that the statute if applied to this case would be unconstitutional. On appeal the Supreme Court of the State agreed that the defendant had contract and property rights protected by the Constitution of the United States, but held that the statute was a legitimate exercise of the police power and directed a decree for the plaintiffs. A writ of error was granted bringing the case to this Court.

 

The statute forbids the mining of anthracite coal in such way as to cause the subsidence of, among other things, any structure used as a human habitation, with certain exceptions, including among them land where the surface is owned by the owner of the underlying coal and is distant more than one hundred and fifty feet from any improved property belonging to any other person. As applied to this case the statute is admitted to destroy previously existing rights of property and contract. The question is whether the police power can be stretched so far.

 

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 cases there must be an exercise of eminent domain and compensation to sustain the act. So the question depends upon the particular facts. The greatest weight is given to the judgment of the legislature, but it always is open to interested parties to contend that the legislature has gone beyond its constitutional power.

 

This is the case of a single private house. No doubt there is a public interest even in this, as there is in every purchase and sale and in all that happens within the commonwealth. Some existing rights may be modified even in such a case. Rideout v. Knox, 148 Mass. 368. But usually in ordinary private affairs the public interest does not warrant much of this kind of interference. A source of damage to such a house is not a public nuisance even if similar damage is inflicted on others in different places. The damage is not common or public. Wesson v. Washburn Iron Co., 13 Allen, 95, 103. The extent of the public interest is shown by the statute to be limited, since the statute ordinarily does not apply to land when the surface is owned by the owner of the coal. Furthermore, it is not justified as a protection of personal safety. That could be provided for by notice. Indeed the very foundation of this bill is that the defendant gave timely notice of its intent to mine under the house. On the other hand the extent of the taking is great. It purports to abolish what is recognized in Pennsylvania as an estate in land – a very valuable estate – and what is declared by the Court below to be a contract hitherto binding the plaintiffs. If we were called upon to deal with the plaintiffs’ position alone, we should think it clear that the statute does not disclose a public interest sufficient to warrant so extensive a destruction of the defendant’s constitutionally protected rights.

 

But the case has been treated as one in which the general validity of the act should be discussed. The Attorney General of the State, the City of Scranton, and the representatives of other extensive interests were allowed to take part in the argument below and have submitted their contentions here. It seems, therefore, to be our duty to go farther in the statement of our opinion, in order that it may be known at once, and that further suits should not be brought in vain.

 

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. As said in a Pennsylvania case, “For practical purposes, the right to coal consists in the right to mine it.” Commonwealth v. Clearview Coal Co., 256 Pa. St. 328, 331. What makes the right to mine coal valuable is that it can be exercised with profit. 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.

 

It is true that in Plymouth Coal Co. v. Pennsylvania, 232 U.S. 531, it was held competent for the legislature to require a pillar of coal to be left along the line of adjoining property, that, with the pillar on the other side of the line, would be a barrier sufficient for the safety of the employees of either mine in case the other should be abandoned and allowed to fill with water. But that was a requirement for the safety of employees invited into the mine, and secured an average reciprocity of advantage that has been recognized as a justification of various laws.

 

The rights of the public in a street purchased or laid out by eminent domain are those that it has paid for. If in any case its representatives have been so short sighted as to acquire only surface rights without the right of support, we see no more authority for supplying the latter without compensation than there was for taking the right of way in the first place and refusing to pay for it because the public wanted it very much. 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. When this seemingly absolute protection is found to be qualified by the police power, the 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. It may be doubted how far exceptional cases, like the blowing up of a house to stop a conflagration, go – and if they go beyond the general rule, whether they do not stand as much upon tradition as upon principle. Bowditch v. Boston, 101 U.S. 16. In general it is not plain that a man’s misfortunes or necessities will justify his shifting the damages to his neighbor’s shoulders. Spade v. Lynn & Boston R.R. Co., 172 Mass. 488, 489. 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 cases decided by this Court. The late decisions upon laws dealing with the congestion of Washington and New York, caused by the war, dealt with laws intended to meet a temporary emergency and providing for compensation determined to be reasonable by an impartial board. They went to the verge of the law but fell far short of the present act. Block v. Hirsh, 256 U.S. 135. Marcus Brown Holding Co. v. Feldman, 256 U.S. 170. Levy Leasing Co. v. Siegel, 258 U.S. 242.

 

We assume, of course, that the statute was passed upon the conviction that an exigency existed that would warrant it, and we assume that an exigency exists that would warrant the exercise of eminent domain. But the question at bottom is upon whom the loss of the changes desired should fall. So far as private persons or communities have seen fit to take the risk of acquiring only surface rights, we cannot see that the fact that their risk has become a danger warrants the giving to them greater rights than they bought.

 

Decree reversed.

 

 

 

Mr Justice Brandeis, dissenting. (multiple citations omitted)

 

 

 

The Kohler Act prohibits, under certain conditions, the mining of anthracite coal within the limits of a city in such a manner or to such an extent “as to cause the … subsidence of any dwelling or other structure used as a human habitation, or any factory, store, or other industrial or mercantile establishment in which human labor is employed.” Coal in place is land; and the right of the owner to use his land is not absolute. He may not so use it as to create a public nuisance; and uses, once harmless, may, owing to changed conditions, seriously threaten the public welfare. Whenever they do, the legislature has power to prohibit such uses without paying compensation; and the power to prohibit extends alike to the manner, the character and the purpose of the use. Are we justified in declaring that the Legislature of Pennsylvania has, in restricting the right to mine anthracite, exercised this power so arbitrarily as to violate the Fourteenth Amendment?

 

Every restriction upon the use of property imposed in the exercise of the police power deprives the owner of some right theretofore enjoyed, and is, in that sense, an abridgment by the State of rights in property without making compensation. But restriction imposed to protect the public health, safety or morals from dangers threatened is not a taking. The restriction here in question is merely the prohibition of a noxious use. The property so restricted remains in the possession of its owner. The State does not appropriate it or make any use of it. The State merely prevents the owner from making a use which interferes with paramount rights of the public. Whenever the use prohibited ceases to be noxious – as it may because of further change in local or social conditions, – the restriction will have to be removed and the owner will again be free to enjoy his property as heretofore.

 

The restriction upon the use of this property can not, of course, be lawfully imposed, unless its purpose is to protect the public. But the purpose of a restriction does not cease to be public, because incidentally some private persons may thereby receive gratuitously valuable special benefits… . . If by mining anthracite coal the owner would necessarily unloose poisonous gasses, I suppose no one would doubt the power of the State to prevent the mining, without buying his coal fields. And why may not the State, likewise, without paying compensation, prohibit one from digging so deep or excavating so near the surface, as to expose the community to like dangers? In the latter case, as in the former, carrying on the business would be a public nuisance.

 

It is said that one fact for consideration in determining whether the limits of the police power have been exceeded is the extent of the resulting diminution in value; and that here the restriction destroys existing rights of property and contract. But values are relative. If we are to consider the value of the coal kept in place by the restriction, we should compare it with the value of all other parts of the land. That is, with the value not of the coal alone, but with the value of the whole property. The rights of an owner as against the public are not increased by dividing the interests in his property into surface and subsoil. The sum of the rights in the parts can not be greater than the rights in the whole. The estate of an owner in land is grandiloquently described as extending ab orco usque ad coelum. But I suppose no one would contend that by selling his interest above one hundred feet from the surface he could prevent the State from limiting, by the police power, the height of structures in a city. And why should a sale of underground rights bar the State’s power? For aught that appears the value of the coal kept in place by the restriction may be negligible as compared with the value of the whole property, or even as compared with that part of it which is represented by the coal remaining in place and which may be extracted despite the statute. Ordinarily a police regulation, general in operation, will not be held void as to a particular property, although proof is offered that owing to conditions peculiar to it the restriction could not reasonably be applied… . . Where the surface and the coal belong to the same person, self-interest would ordinarily prevent mining to such an extent as to cause a subsidence. It was, doubtless, for this reason that the legislature, estimating the degrees of danger, deemed statutory restriction unnecessary for the public safety under such conditions.

 

… .

 

The [majority’s] conclusion seems to rest upon the assumption that in order to justify such exercise of the police power there must be “an average reciprocity of advantage” as between the owner of the property restricted and the rest of the community; and that here such reciprocity is absent. Reciprocity of advantage is an important consideration, and may even be an essential, where the State’s power is exercised for the purpose of conferring benefits upon the property of a neighborhood, as in drainage projects, or upon adjoining owners, as by party wall provisions. But where the police power is exercised, not to confer benefits upon property owners, but to protect the public from detriment and danger, there is, in my opinion, no room for considering reciprocity of advantage. There was no reciprocal advantage to the owner prohibited from using his oil tanks in 248 U.S. 498; his brickyard, in 239 U.S. 394; his livery stable, in 237 U.S. 171; his billiard hall, in 225 U.S. 623; his oleomargarine factory, in 127 U.S. 678; his brewery, in 123 U.S. 623; unless it be the advantage of living and doing business in a civilized community. That reciprocal advantage is given by the act to the coal operators.

 

 

Penn Central Transportation Co. v. New York City,

438 U.S. 104 (1978)

 

 

 

Daniel M. Gribbon argued the cause for appellants. With him on the briefs were John R. Bolton and Carl Helmetag, Jr.

 

Leonard Koerner argued the cause for appellees. With him on the brief were Allen G. Schwartz, L. Kevin Sheridan, and Dorothy Miner.

 

Assistant Attorney General Wald argued the cause for the United States as amicus curiae urging affirmance. On the brief were Solicitor General McCree, Assistant Attorney General Moorman, Peter R. Steenland, Jr., and Carl Strass.1

 

Briefs of amici curiae were filed by Evelle J. Younger, Attorney General, E. Clement Shute, Jr., and Robert H. Connett, Assistant Attorneys General, and Richard C. Jacobs, Deputy Attorney General, for the State of California; and by Eugene J. Morris for the Real Estate Board of New York, Inc.

 

 

 

Mr. Justice Brennan delivered the opinion of the Court.

 

 

 

The question presented is whether a city may, as part of a comprehensive program to preserve historic landmarks and historic districts, place restrictions on the development of individual historic landmarks–in addition to those imposed by applicable zoning ordinances–without effecting a “taking” requiring the payment of “just compensation.” Specifically, we must decide whether the application of New York City’s Landmarks Preservation Law to the parcel of land occupied by Grand Central Terminal has “taken” its owners’ property in violation of the Fifth and Fourteenth Amendments.

 

 

 

 

I

 

 

 

 

 

 

 

A

 

 

 

 

Over the past 50 years, all 50 States and over 500 municipalities have enacted laws to encourage or require the preservation of buildings and areas with historic or aesthetic importance.2 These nationwide legislative efforts have been precipitated by two concerns. The first is recognition that, in recent years, large numbers of historic structures, landmarks, and areas have been destroyed3 without adequate consideration of either the values represented therein or the possibility of preserving the destroyed properties for use in economically productive ways.4 The second is a widely shared belief that structures with special historic, cultural, or architectural significance enhance the quality of life for all. Not only do these buildings and their workmanship represent the lessons of the past and embody precious features of our heritage, they serve as examples of quality for today. “[H]istoric conservation is but one aspect of the much larger problem, basically an environmental one, of enhancing–or perhaps developing for the first time–the quality of life for people.”5

 

New York City, responding to similar concerns and acting pursuant to a New York State enabling Act,6 adopted its Landmarks Preservation Law in 1965. See N. Y. C. Admin. Code, ch. 8-A, § 205-1.0 et seq. (1976). The city acted from the conviction that “the standing of [New York City] as a world-wide tourist center and world capital of business, culture and government” would be threatened if legislation were not enacted to protect historic landmarks and neighborhoods from precipitate decisions to destroy or fundamentally alter their character. § 205-1.0 (a). The city believed that comprehensive measures to safeguard desirable features of the existing urban fabric would benefit its citizens in a variety of ways: e. g., fostering “civic pride in the beauty and noble accomplishments of the past”; protecting and enhancing “the city’s attractions to tourists and visitors”; “support[ing] and stimul[ating] business and industry”; “strengthen[ing] the economy of the city”; and promoting “the use of historic districts, landmarks, interior landmarks and scenic landmarks for the education, pleasure and welfare of the people of the city.” § 205-1.0 (b).

 

The New York City law is typical of many urban landmark laws in that its primary method of achieving its goals is not by acquisitions of historic properties,7 but rather by involving public entities in land-use decisions affecting these properties and providing services, standards, controls, and incentives that will encourage preservation by private owners and users.8 While the law does place special restrictions on landmark properties as a necessary feature to the attainment of its larger objectives, the major theme of the law is to ensure the owners of any such properties both a “reasonable return” on their investments and maximum latitude to use their parcels for purposes not inconsistent with the preservation goals.

 

… .

 

 

 

 

B

 

 

 

 

This case involves the application of New York City’s Landmarks Preservation Law to Grand Central Terminal (Terminal). The Terminal, which is owned by the Penn Central Transportation Co. and its affiliates (Penn Central), is one of New York City’s most famous buildings. Opened in 1913, it is regarded not only as providing an ingenious engineering solution to the problems presented by urban railroad stations, but also as a magnificent example of the French beaux-arts style.

 

… .

 

On August 2, 1967, following a public hearing, the Commission designated the Terminal a “landmark” and designated the “city tax block” it occupies a “landmark site.”9 The Board of Estimate confirmed this action on September 21, 1967. Although appellant Penn Central had opposed the designation before the Commission, it did not seek judicial review of the final designation decision.

 

On January 22, 1968, appellant Penn Central, to increase its income, entered into a renewable 50-year lease and sublease agreement with appellant UGP Properties, Inc. (UGP), a wholly owned subsidiary of Union General Properties, Ltd., a United Kingdom corporation. Under the terms of the agreement, UGP was to construct a multistory office building above the Terminal. UGP promised to pay Penn Central $1 million annually during construction and at least $3 million annually thereafter. The rentals would be offset in part by a loss of some $700,000 to $1 million in net rentals presently received from concessionaires displaced by the new building.

 

Appellants UGP and Penn Central then applied to the Commission for permission to construct an office building atop the Terminal. Two separate plans, both designed by architect Marcel Breuer and both apparently satisfying the terms of the applicable zoning ordinance, were submitted to the Commission for approval. The first, Breuer I, provided for the construction of a 55-story office building, to be cantilevered above the existing facade and to rest on the roof of the Terminal. The second, Breuer II Revised,10 called for tearing down a portion of the Terminal that included the 42d Street facade, stripping off some of the remaining features of the Terminal’s facade, and constructing a 53-story office building. The Commission denied a certificate of no exterior effect on September 20, 1968. Appellants then applied for a certificate of “appropriateness” as to both proposals. After four days of hearings at which over 80 witnesses testified, the Commission denied this application as to both proposals.

 

The Commission’s reasons for rejecting certificates respecting Breuer II Revised are summarized in the following statement: “To protect a Landmark, one does not tear it down. To perpetuate its architectural features, one does not strip them off.” Record 2255. Breuer I, which would have preserved the existing vertical facades of the present structure, received more sympathetic consideration… . . In conclusion, the Commission stated:

 

 

“[We have] no fixed rule against making additions to designated buildings–it all depends on how they are done … . But to balance a 55-story office tower above a flamboyant Beaux-Arts facade seems nothing more than an aesthetic joke. Quite simply, the tower would overwhelm the Terminal by its sheer mass. The ‘addition’ would be four times as high as the existing structure and would reduce the Landmark itself to the status of a curiosity.

 

 

 

“Landmarks cannot be divorced from their settings– particularly when the setting is a dramatic and integral part of the original concept. The Terminal, in its setting, is a great example of urban design. Such examples are not so plentiful in New York City that we can afford to lose any of the few we have. And we must preserve them in a meaningful way–with alterations and additions of such character, scale, materials and mass as will protect, enhance and perpetuate the original design rather than overwhelm it.”

 

 

Id., at 2251.11

 

… .

 

The New York Court of Appeals … summarily rejected any claim that the Landmarks Law had “taken” property without “just compensation,” id., at 329, 366 N. E. 2d, at 1274, indicating that there could be no “taking” since the law had not transferred control of the property to the city, but only restricted appellants’ exploitation of it… . .

 

 

 

 

II

 

 

 

 

The issues presented by appellants are (1) whether the restrictions imposed by New York City’s law upon appellants’ exploitation of the Terminal site effect a “taking” of appellants’ property for a public use within the meaning of the Fifth Amendment, which of course is made applicable to the States through the Fourteenth Amendment, see Chicago, B. & Q. R. Co. v. Chicago, 166 U. S. 226, 239 (1897),

 

 

 

 

7.4.2.2. Per se Takings

 

Lucas v. South Carolina Coastal Council,

505 U.S. 1003 (1992)

 

 

 

A. Camden Lewis argued the cause for petitioner. With him on the briefs were Gerald M. Finkel and David J. Bederman.

 

C. C. Harness III argued the cause for respondent. With him on the brief were T. Travis Medlock, Attorney General of South Carolina, Kenneth P. Woodington, Senior Assistant Attorney General, and Richard J. Lazarus.1

 

 

 

Justice Scalia, delivered the opinion of the Court.

 

 

 

In 1986, petitioner David H. Lucas paid $975,000 for two residential lots on the Isle of Palms in Charleston County, South Carolina, on which he intended to build single-family homes. In 1988, however, the South Carolina Legislature enacted the Beachfront Management Act, S. C. Code Ann. § 48-39-250 et seq. (Supp. 1990), which had the direct effect of barring petitioner from erecting any permanent habitable structures on his two parcels. See § 48-39-290(A). A state trial court found that this prohibition rendered Lucas’s parcels “valueless.” App. to Pet. for Cert. 37. This case requires us to decide whether the Act’s dramatic effect on the economic value of Lucas’s lots accomplished a taking of private property under the Fifth and Fourteenth Amendments requiring the payment of “just compensation.” U. S. Const., Amdt. 5.

 

 

 

I

 

 

 

 

 

 

A

 

 

 

 

South Carolina’s expressed interest in intensively managing development activities in the so-called “coastal zone” dates from 1977 when, in the aftermath of Congress’s passage of the federal Coastal Zone Management Act of 1972, 86 Stat. 1280, as amended, 16 U. S. C. § 1451 et seq., the legislature enacted a Coastal Zone Management Act of its own. See S. C. Code Ann. § 48-39-10 et seq. (1987). In its original form, the South Carolina Act required owners of coastal zone land that qualified as a “critical area” (defined in the legislation to include beaches and immediately adjacent sand dunes, § 48-39-10(J)) to obtain a permit from the newly created South Carolina Coastal Council (Council) (respondent here) prior to committing the land to a “use other than the use the critical area was devoted to on [September 28, 1977].” § 48-39-130(A).

 

In the late 1970’s, Lucas and others began extensive residential development of the Isle of Palms, a barrier island situated eastward of the city of Charleston. Toward the close of the development cycle for one residential subdivision known as “Beachwood East,” Lucas in 1986 purchased the two lots at issue in this litigation for his own account. No portion of the lots, which were located approximately 300 feet from the beach, qualified as a “critical area” under the 1977 Act; accordingly, at the time Lucas acquired these parcels, he was not legally obliged to obtain a permit from the Council in advance of any development activity. His intention with respect to the lots was to do what the owners of the immediately adjacent parcels had already done: erect singlefamily residences. He commissioned architectural drawings for this purpose.

 

The Beachfront Management Act brought Lucas’s plans to an abrupt end. Under that 1988 legislation, the Council was directed to establish a “baseline” connecting the landwardmost “point[s] of erosion … during the past forty years” in the region of the Isle of Palms that includes Lucas’s lots. S. C. Code Ann. § 48-39-280(A)(2) (Supp. 1988).2 In action not challenged here, the Council fixed this baseline landward of Lucas’s parcels. That was significant, for under the Act construction of occupable improvements3 was flatly prohibited seaward of a line drawn 20 feet landward of, and parallel to, the baseline. § 48-39-290(A). The Act provided no exceptions.

 

 

 

 

B

 

 

 

 

Lucas promptly filed suit in the South Carolina Court of Common Pleas, contending that the Beachfront Management Act’s construction bar effected a taking of his property without just compensation. Lucas did not take issue with the validity of the Act as a lawful exercise of South Carolina’s police power, but contended that the Act’s complete extinguishment of his property’s value entitled him to compensation regardless of whether the legislature had acted in furtherance of legitimate police power objectives. Following a bench trial, the court agreed. Among its factual determinations was the finding that “at the time Lucas purchased the two lots, both were zoned for single-family residential construction and … there were no restrictions imposed upon such use of the property by either the State of South Carolina, the County of Charleston, or the Town of the Isle of Palms.” App. to Pet. for Cert. 36. The trial court further found that the Beachfront Management Act decreed a permanent ban on construction insofar as Lucas’s lots were concerned, and that this prohibition “deprive[d] Lucas of any reasonable economic use of the lots, … eliminated the unrestricted right of use, and render[ed] them valueless.” Id., at 37. The court thus concluded that Lucas’s properties had been “taken” by operation of the Act, and it ordered respondent to pay “just compensation” in the amount of $1,232,387.50. Id., at 40.

 

The Supreme Court of South Carolina reversed. It found dispositive what it described as Lucas’s concession “that the Beachfront Management Act [was] properly and validly designed to preserve … South Carolina’s beaches.” 304 S. C. 376, 379, 404 S. E. 2d 895, 896 (1991). Failing an attack on the validity of the statute as such, the court believed itself bound to accept the “uncontested … findings” of the South Carolina Legislature that new construction in the coastal zone–such as petitioner intended–threatened this public resource. Id., at 383, 404 S. E. 2d, at 898. The court ruled that when a regulation respecting the use of property is designed “to prevent serious public harm,” id., at 383, 404 S. E. 2d, at 899 (citing, inter alia, Mugler v. Kansas, 123 U. S. 623 (1887)), no compensation is owing under the Takings Clause regardless of the regulation’s effect on the property’s value.

 

Two justices dissented. They acknowledged that our Mugler line of cases recognizes governmental power to prohibit “noxious” uses of property–i. e., uses of property akin to “public nuisances”–without having to pay compensation. But they would not have characterized the Beachfront Management Act’s ”primary purpose [as] the prevention of a nuisance.” 304 S. C., at 395, 404 S. E. 2d, at 906 (Harwell, J., dissenting). To the dissenters, the chief purposes of the legislation, among them the promotion of tourism and the creation of a “habitat for indigenous flora and fauna,” could not fairly be compared to nuisance abatement. Id., at 396, 404 S. E. 2d, at 906. As a consequence, they would have affirmed the trial court’s conclusion that the Act’s obliteration of the value of petitioner’s lots accomplished a taking.

 

We granted certiorari. 502 U. S. 966 (1991).

 

… .

 

 

 

III

 

 

 

 

 

 

A

 

 

 

 

Prior to Justice Holmes’s exposition in Pennsylvania Coal Co. v. Mahon, 260 U. S. 393 (1922), it was generally thought that the Takings Clause reached only a “direct appropriation” of property, Legal Tender Cases, 12 Wall. 457, 551 (1871), or the functional equivalent of a “practical ouster of [the owner’s] possession,” Transportation Co. v. Chicago, 99 U. S. 635, 642 (1879). See also Gibson v. United States, 166 U. S. 269, 275-276 (1897). Justice Holmes recognized in Mahon, however, that if the protection against physical appropriations of private property was to be meaningfully enforced, the government’s power to redefine the range of interests included in the ownership of property was necessarily constrained by constitutional limits. 260 U. S., at 414-415. If, instead, the uses of private property were subject to unbridled, uncompensated qualification under the police power, “the natural tendency of human nature [would be] to extend the qualification more and more until at last private property disappear[ed].” Id., at 415. These considerations gave birth in that case to the oft-cited maxim that, “while property may be regulated to a certain extent, if regulation goes too far it will be recognized as a taking.” Ibid.

 

Nevertheless, our decision in Mahon offered little insight into when, and under what circumstances, a given regulation would be seen as going “too far” for purposes of the Fifth Amendment. In 70-odd years of succeeding “regulatory takings” jurisprudence, we have generally eschewed any “‘set formula’ ” for determining how far is too far, preferring to “engag[e] in … essentially ad hoc, factual inquiries.” Penn Central Transportation Co. v. New York City, 438 U. S. 104, 124 (1978) (quoting Goldblatt v. Hempstead, 369 U. S. 590, 594 (1962)). See Epstein, Takings: Descent and Resurrection, 1987 S. Ct. Rev. 1, 4. We have, however, described at least two discrete categories of regulatory action as compensable without case-specific inquiry into the public interest advanced in support of the restraint. The first encompasses regulations that compel the property owner to suffer a physical “invasion” of his property. In general (at least with regard to permanent invasions), no matter how minute the intrusion, and no matter how weighty the public purpose behind it, we have required compensation. For example, in Loretto v. eleprompter Manhattan CATV Corp., 458 U. S. 419 (1982), we determined that New York’s law requiring landlords to allow television cable companies to emplace cable facilities in their apartment buildings constituted a taking, id., at 435-440, even though the facilities occupied at most only 1 12 cubic feet of the landlords’ property, see id., at 438, n. 16. See also United States v. Causby, 328 U. S. 256, 265, and n. 10 (1946) (physical invasions of airspace); cf. Kaiser Aetna v. United States, 444 U. S. 164 (1979) (imposition of navigational servitude upon private marina).

 

The second situation in which we have found categorical treatment appropriate is where regulation denies all economically beneficial or productive use of land. See Agins, 447 U. S., at 260; see also Nollan v. California Coastal Comm’n, 483 U. S. 825, 834 (1987); Keystone Bituminous Coal Assn. v. DeBenedictis, 480 U. S. 470, 495 (1987); Hodel v. Virginia Surface Mining & Reclamation Assn., Inc., 452 U. S. 264, 295-296 (1981).4 As we have said on numerous occasions, the Fifth Amendment is violated when land-use regulation “does not substantially advance legitimate state interests or denies an owner economically viable use of his land.Agins, supra, at 260 (citations omitted) (emphasis added).5

 

We have never set forth the justification for this rule. Perhaps it is simply, as Justice Brennan suggested, that total deprivation of beneficial use is, from the landowner’s point of view, the equivalent of a physical appropriation. See San Diego Gas & Electric Co. v. San Diego, 450 U. S., at 652 (dissenting opinion). “[F]or what is the land but the profits thereof[?]” 1 E. Coke, Institutes, ch. 1, § 1 (1st Am. ed. 1812). Surely, at least, in the extraordinary circumstance when no productive or economically beneficial use of land is permitted, it is less realistic to indulge our usual assumption that the legislature is simply “adjusting the benefits and burdens of economic life,” Penn Central Transportation Co., 438 U. S., at 124, in a manner that secures an “average reciprocity of advantage” to everyone concerned, Pennsylvania Coal Co. v. Mahon, 260 U. S., at 415. And the functional basis for permitting the government, by regulation, to affect property values without compensation–that “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,” id., at 413–does not apply to the relatively rare situations where the government has deprived a landowner of all economically beneficial uses.

 

On the other side of the balance, affirmatively supporting a compensation requirement, is the fact that regulations that leave the owner of land without economically beneficial or productive options for its use–typically, as here, by requiring land to be left substantially in its natural state–carry with them a heightened risk that private property is being pressed into some form of public service under the guise of mitigating serious public harm. See, e. g., Annicelli v. South Kingstown, 463 A. 2d 133, 140-141 (R. I. 1983) (prohibition on construction adjacent to beach justified on twin grounds of safety and “conservation of open space”); Morris County Land Improvement Co. v. Parsippany-Troy Hills Township, 40 N. J.539, 552-553, 193 A. 2d 232, 240 (1963) (prohibition on filling marshlands imposed in order to preserve region as water detention basin and create wildlife refuge). As Justice Brennan explained: “From the government’s point of view, the benefits flowing to the public from preservation of open space through regulation may be equally great as from creating a wildlife refuge through formal condemnation or increasing electricity production through a dam project that floods private property.” San Diego Gas & Elec. Co., supra, at 652 (dissenting opinion). The many statutes on the books, both state and federal, that provide for the use of eminent domain to impose servitudes on private scenic lands preventing developmental uses, or to acquire such lands altogether, suggest the practical equivalence in this setting of negative regulation and appropriation. See, e. g., 16 U. S. C. § 410ff-1(a) (authorizing acquisition of “lands, waters, or interests [within Channel Islands National Park] (including but not limited to scenic easements)”); § 460aa-2(a) (authorizing acquisition of “any lands, or lesser interests therein, including mineral interests and scenic easements” within Sawtooth National Recreation Area); §§ 3921-3923 (authorizing acquisition of wetlands); N. C. Gen. Stat. § 113A-38 (1990) (authorizing acquisition of, inter alia, “‘scenic easements’ ” within the North Carolina natural and scenic rivers system); Tenn. Code Ann. §§ 11-15-101 to XX-XX-XXX (1987) (authorizing acquisition of “protective easements” and other rights in real property adjacent to State’s historic, architectural, archaeological, or cultural resources).

 

We think, in short, that there are good reasons for our frequently expressed belief that when the owner of real property has been called upon to sacrifice all economically beneficial uses in the name of the common good, that is, to leave his property economically idle, he has suffered a taking.6

 

 

 

 

B

 

 

 

 

The trial court found Lucas’s two beachfront lots to have been rendered valueless by respondent’s enforcement of the coastal-zone construction ban.7 Under Lucas’s theory of the case, which rested upon our “no economically viable use” statements, that finding entitled him to compensation. Lucas believed it unnecessary to take issue with either the purposes behind the Beachfront Management Act, or the means chosen by the South Carolina Legislature to effectuate those purposes. The South Carolina Supreme Court, however, thought otherwise. In its view, the Beachfront Management Act was no ordinary enactment, but involved an exercise of South Carolina’s “police powers” to mitigate the harm to the public interest that petitioner’s use of his land might occasion. 304 S. C., at 384, 404 S. E. 2d, at 899. By neglecting to dispute the findings enumerated in the Act8 or otherwise to challenge the legislature’s purposes, petitioner “concede[d] that the beach/dune area of South Carolina’s shores is an extremely valuable public resource; that the erection of new construction, inter alia, contributes to the erosion and destruction of this public resource; and that discouraging new construction in close proximity to the beach/dune area is necessary to prevent a great public harm.” Id., at 382-383, 404 S. E. 2d, at 898. In the court’s view, these concessions brought petitioner’s challenge within a long line of this Court’s cases sustaining against Due Process and Takings Clause challenges the State’s use of its “police powers” to enjoin a property owner from activities akin to public nuisances. See Mugler v. Kansas, 123 U. S. 623 (1887) (law prohibiting manufacture of alcoholic beverages); Hadacheck v. Sebastian, 239 U. S. 394 (1915) (law barring operation of brick mill in residential area); Miller v. Schoene, 276 U. S. 272 (1928) (order to destroy diseased cedar trees to prevent infection of nearby orchards); Goldblatt v. Hempstead, 369 U. S. 590 (1962) (law effectively preventing continued operation of quarry in residential area).

 

It is correct that many of our prior opinions have suggested that “harmful or noxious uses” of property may be proscribed by government regulation without the requirement of compensation. For a number of reasons, however, we think the South Carolina Supreme Court was too quick to conclude that that principle decides the present case. The “harmful or noxious uses” principle was the Court’s early attempt to describe in theoretical terms why government may, consistent with the Takings Clause, affect property values by regulation without incurring an obligation to compensate–a reality we nowadays acknowledge explicitly with respect to the full scope of the State’s police power. See, e. g., Penn Central Transportation Co., 438 U. S., at 125 (where State “reasonably conclude[s] that ‘the health, safety, morals, or general welfare’ would be promoted by prohibiting particular contemplated uses of land,” compensation need not accompany prohibition); see also Nollan v. California Coastal Comm’n, 483 U. S., at 834-835 (“Our cases have not elaborated on the standards for determining what constitutes a ‘legitimate state interest[,]’ [but] [t]hey have made clear … that a broad range of governmental purposes and regulations satisfy these requirements”). We made this very point in Penn Central Transportation Co., where, in the course of sustaining New York City’s landmarks preservation program against a takings challenge, we rejected the petitioner’s suggestion that Mugler and the cases following it were premised on, and thus limited by, some objective conception of “noxiousness”:

 

 

“[T]he uses in issue in Hadacheck, Miller, and Goldblatt were perfectly lawful in themselves. They involved no ‘blameworthiness, … moral wrongdoing or conscious act of dangerous risk-taking which induce[d society] to shift the cost to a pa[rt]icular individual.’ Sax, Takings and the Police Power, 74 Yale L. J. 36, 50 (1964). These cases are better understood as resting not on any supposed ‘noxious’ quality of the prohibited uses but rather on the ground that the restrictions were reasonably related to the implementation of a policy–not unlike historic preservation–expected to produce a widespread public benefit and applicable to all similarly situated property.” 438 U. S., at 133-134, n. 30.

 

 

“Harmful or noxious use” analysis was, in other words, simply the progenitor of our more contemporary statements that “land-use regulation does not effect a taking if it ‘substantially advance[s] legitimate state interests’ . .. .” Nollan, supra, at 834 (quoting Agins v. Tiburon, 447 U. S., at 260); see also Penn Central Transportation Co., supra, at 127; Euclid v. Ambler Realty Co., 272 U. S. 365, 387-388 (1926).

 

The transition from our early focus on control of “noxious” uses to our contemporary understanding of the broad realm within which government may regulate without compensation was an easy one, since the distinction between “harmpreventing” and “benefit-conferring” regulation is often in the eye of the beholder. It is quite possible, for example, to describe in either fashion the ecological, economic, and esthetic concerns that inspired the South Carolina Legislature in the present case. One could say that imposing a servitude on Lucas’s land is necessary in order to prevent his use of it from “harming” South Carolina’s ecological resources; or, instead, in order to achieve the “benefits” of an ecological preserve.9 Compare, e. g., Claridge v. New Hampshire Wetlands Board, 125 N. H. 745, 752, 485 A. 2d 287, 292 (1984) (owner may, without compensation, be barred from filling wetlands because landfilling would deprive adjacent coastal habitats and marine fisheries of ecological support), with, e. g., Bartlett v. Zoning Comm’n of Old Lyme, 161 Conn. 24, 30, 282 A. 2d 907, 910 (1971) (owner barred from filling tidal marshland must be compensated, despite municipality’s “laudable” goal of “preserv[ing] marshlands from encroachment or destruction”). Whether one or the other of the competing characterizations will come to one’s lips in a particular case depends primarily upon one’s evaluation of the worth of competing uses of real estate. See Restatement (Second) of Torts § 822, Comment g, p. 112 (1979) (“Practically all human activities unless carried on in a wilderness interfere to some extent with others or involve some risk of interference”). A given restraint will be seen as mitigating “harm” to the adjacent parcels or securing a “benefit” for them, depending upon the observer’s evaluation of the relative importance of the use that the restraint favors. See Sax, Takings and the Police Power, 74 Yale L. J. 36, 49 (1964) (“[T]he problem [in this area] is not one of noxiousness or harm-creating activity at all; rather it is a problem of inconsistency between perfectly innocent and independently desirable uses”). Whether Lucas’s construction of singlefamily residences on his parcels should be described as bringing “harm” to South Carolina’s adjacent ecological resources thus depends principally upon whether the describer believes that the State’s use interest in nurturing those resources is so important that any competing adjacent use must yield.10

 

When it is understood that “prevention of harmful use” was merely our early formulation of the police power justification necessary to sustain (without compensation) any regulatory diminution in value; and that the distinction between regulation that “prevents harmful use” and that which “confers benefits” is difficult, if not impossible, to discern on an objective, value-free basis; it becomes self-evident that noxious-use logic cannot serve as a touchstone to distinguish regulatory “takings” – which require compensation – from regulatory deprivations that do not require compensation. A fortiori the legislature’s recitation of a noxious-use justification cannot be the basis for departing from our categorical rule that total regulatory takings must be compensated. If it were, departure would virtually always be allowed. The South Carolina Supreme Court’s approach would essentially nullify Mahon ‘s affirmation of limits to the noncompensable exercise of the police power. Our cases provide no support for this: None of them that employed the logic of “harmful use” prevention to sustain a regulation involved an allegation that the regulation wholly eliminated the value of the claimant’s land. See Keystone Bituminous Coal Assn., 480 U. S., at 513-514 (Rehnquist, C. J., dissenting).11

 

Where the State seeks to sustain regulation that deprives land of all economically beneficial use, we think it may resist compensation only if the 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.12 This accords, we think, with our “takings” jurisprudence, which has traditionally been guided by the understandings of our citizens regarding the content of, and the State’s power over, the “bundle of rights” that they acquire when they obtain title to property. It seems to us that the property owner necessarily expects the uses of his property to be restricted, from time to time, by various measures newly enacted by the State in legitimate exercise of its police powers; “[a]s long recognized, some values are enjoyed under an implied limitation and must yield to the police power.” Pennsylvania Coal Co. v. Mahon, 260 U. S., at 413. And in the case of personal property, by reason of the State’s traditionally high degree of control over commercial dealings, he ought to be aware of the possibility that new regulation might even render his property economically worthless (at least if the property’s only economically productive use is sale or manufacture for sale). See Andrus v. Allard, 444 U. S. 51, 66-67 (1979) (prohibition on sale of eagle feathers). In the case of land, however, we think the notion pressed by the Council that title is somehow held subject to the “implied limitation” that the State may subsequently eliminate all economically valuable use is inconsistent with the historical compact recorded in the Takings Clause that has become part of our constitutional culture.13

 

Where “permanent physical occupation” of land is concerned, we have refused to allow the government to decree it anew (without compensation), no matter how weighty the asserted “public interests” involved, Loretto v. Teleprompter Manhattan CATV Corp., 458 U. S., at 426 – though we assuredly would permit the government to assert a permanent easement that was a pre-existing limitation upon the landowner’s title. Compare Scranton v. Wheeler, 179 U. S. 141, 163 (1900) (interests of “riparian owner in the submerged lands … bordering on a public navigable water” held subject to Government’s navigational servitude), with Kaiser Aetna v. United States, 444 U. S., at 178-180 (imposition of navigational servitude on marina created and rendered navigable at private expense held to constitute a taking). We believe similar treatment must be accorded confiscatory regulations, i. e., regulations that prohibit all economically beneficial use of land: Any limitation so severe cannot be newly legislated or decreed (without compensation), but must inhere in the title itself, in the restrictions that background principles of the State’s law of property and nuisance already place upon land ownership. A law or decree with such an effect must, in other words, do no more than duplicate the result that could have been achieved in the courts – by adjacent landowners (or other uniquely affected persons) under the State’s law of private nuisance, or by the State under its complementary power to abate nuisances that affect the public generally, or otherwise.14

 

On this analysis, the owner of a lake bed, for example, would not be entitled to compensation when he is denied the requisite permit to engage in a land filling operation that would have the effect of flooding others’ land. Nor the corporate owner of a nuclear generating plant, when it is directed to remove all improvements from its land upon discovery that the plant sits astride an earthquake fault. Such regulatory action may well have the effect of eliminating the land’s only economically productive use, but it does not proscribe a productive use that was previously permissible under relevant property and nuisance principles. The use of these properties for what are now expressly prohibited purposes was always unlawful, and (subject to other constitutional limitations) it was open to the State at any point to make the implication of those background principles of nuisance and property law explicit. See Michelman, Property, Utility, and Fairness, Comments on the Ethical Foundations of “Just Compensation” Law, 80 Harv. L. Rev. 1165, 1239 – 1241 (1967). In light of our traditional resort to “existing rules or understandings that stem from an independent source such as state law” to define the range of interests that qualify for protection as “property” under the Fifth and Fourteenth Amendments, Board of Regents of State Colleges v. Roth, 408 U. S. 564, 577 (1972); see, e. g., Ruckelshaus v. Monsanto Co., 467 U. S. 986, 1011-1012 (1984); Hughes v. Washington, 389 U. S. 290, 295 (1967) (Stewart, J., concurring), this recognition that the Takings Clause does not require compensation when an owner is barred from putting land to a use that is proscribed by those “existing rules or understandings” is surely unexceptional. When, however, a regulation that declares “off-limits” all economically productive or beneficial uses of land goes beyond what the relevant background principles would dictate, compensation must be paid to sustain it.15

 

The “total taking” inquiry we require today will ordinarily entail (as the application of state nuisance law ordinarily entails) analysis of, among other things, the degree of harm to public lands and resources, or adjacent private property, posed by the claimant’s proposed activities, see, e. g., Restatement (Second) of Torts §§ 826, 827, the social value of the claimant’s activities and their suitability to the locality in question, see, e. g., id., §§ 828(a) and (b), 831, and the relative ease with which the alleged harm can be avoided through measures taken by the claimant and the government (or adjacent private landowners) alike, see, e. g., id., §§ 827(e), 828(c), 830. The fact that a particular use has long been engaged in by similarly situated owners ordinarily imports a lack of any common-law prohibition (though changed circumstances or new knowledge may make what was previously permissible no longer so, see id., § 827, Comment g. So also does the fact that other landowners, similarly situated, are permitted to continue the use denied to the claimant.

 

It seems unlikely that common-law principles would have prevented the erection of any habitable or productive improvements on petitioner’s land; they rarely support prohibition of the “essential use” of land, Curtin v. Benson, 222 U. S. 78, 86 (1911). The question, however, is one of state law to be dealt with on remand. We emphasize that to win its case South Carolina must do more than proffer the legislature’s declaration that the uses Lucas desires are inconsistent with the public interest, or the conclusory assertion that they violate a common-law maxim such as sic utere tuo ut alienum non laedas. As we have said, a “State, by ipse dixit, may not transform private property into public property without compensation … .” Webb’s Fabulous Pharmacies, Inc. v. Beckwith, 449 U. S. 155, 164 (1980). Instead, as it would be required to do if it sought to restrain Lucas in a commonlaw action for public nuisance, South Carolina must identify background principles of nuisance and property law that prohibit the uses he now intends in the circumstances in which the property is presently found. Only on this showing can the State fairly claim that, in proscribing all such beneficial uses, the Beach front Management Act is taking nothing.16

 

 

 

 

* * *

 

 

 

 

The judgment is reversed, and the case is remanded for proceedings not inconsistent with this opinion.

 

So ordered.

 

 

 

Justice Kennedy, concurring in the judgment.

 

 

 

The case comes to the Court in an unusual posture, as all my colleagues observe. Ante, at 1010-1011; post, at 1041 (Blackmun, J., dissenting); post, at 1061-1062 (Stevens, J., dissenting); post, at 1076-1077 (statement of Souter, J.). After the suit was initiated but before it reached us, South Carolina amended its Beach front Management Act to authorize the issuance of special permits at variance with the Act’s general limitations. See S. C. Code Ann. § 48-39-290(D)(1) (Supp. 1991). Petitioner has not applied for a special permit but may still do so. The availability of this alternative, if it can be invoked, may dispose of petitioner’s claim of a permanent taking. As I read the Court’s opinion, it does not decide the permanent taking claim, but neither does it foreclose the Supreme Court of South Carolina from considering the claim or requiring petitioner to pursue an administrative alternative not previously available.

 

The potential for future relief does not control our disposition, because whatever may occur in the future cannot undo what has occurred in the past. The Beach front Management Act was enacted in 1988. S. C. Code Ann. § 48-39-250 et seq. (Supp. 1990). It may have deprived petitioner of the use of his land in an interim period. § 48-39-290(A). If this deprivation amounts to a taking, its limited duration will not bar constitutional relief. It is well established that temporary takings are as protected by the Constitution as are permanent ones. First English Evangelical Lutheran Church of Glendale v. County of Los Angeles, 482 U. S. 304, 318 (1987).

 

The issues presented in the case are ready for our decision. The Supreme Court of South Carolina decided the case on constitutional grounds, and its rulings are now before us. There exists no jurisdictional bar to our disposition, and prudential considerations ought not to militate against it. The State cannot complain of the manner in which the issues arose. Any uncertainty in this regard is attributable to the State, as a consequence of its amendment to the Beach front Management Act. If the Takings Clause is to protect against temporary deprivations, as well as permanent ones, its enforcement must not be frustrated by a shifting background of state law.

 

Although we establish a framework for remand, moreover, we do not decide the ultimate question whether a temporary taking has occurred in this case. The facts necessary to the determination have not been developed in the record. Among the matters to be considered on remand must be whether petitioner had the intent and capacity to develop the property and failed to do so in the interim period because the State prevented him. Any failure by petitioner to comply with relevant administrative requirements will be part of that analysis.

 

The South Carolina Court of Common Pleas found that petitioner’s real property has been rendered valueless by the State’s regulation. App. to Pet. for Cert. 37. The finding appears to presume that the property has no significant market value or resale potential. This is a curious finding, and I share the reservations of some of my colleagues about a finding that a beach front lot loses all value because of a development restriction. Post, at 1043-1045 (Blackmun, J., dissenting); post, at 1065, n. 3 (Stevens, J., dissenting); post, at 1076 (statement of Souter, J.). While the Supreme Court of South Carolina on remand need not consider the case subject to this constraint, we must accept the finding as entered below. See Oklahoma City v. Tuttle, 471 U. S. 808, 816 (1985). Accepting the finding as entered, it follows that petitioner is entitled to invoke the line of cases discussing regulations that deprive real property of all economic value. See Agins v. City of Tiburon, 447 U. S. 255, 260 (1980).

 

The finding of no value must be considered under the Takings Clause by reference to the owner’s reasonable, investment-backed expectations. Kaiser Aetna v. United States, 444 U. S. 164, 175 (1979); Penn Central Transportation Co. v. New York City, 438 U. S. 104, 124 (1978); see also W. B. Worthen Co. v. Kavanaugh, 295 U. S. 56 (1935). The Takings Clause, while conferring substantial protection on property owners, does not eliminate the police power of the State to enact limitations on the use of their property.Mugler v. Kansas, 123 U. S. 623, 669 (1887). The rights conferred by the Takings Clause and the police power of the State may coexist without conflict. Property is bought and sold, investments are made, subject to the State’s power to regulate. Where a taking is alleged from regulations which deprive the property of all value, the test must be whether the deprivation is contrary to reasonable, investmentbacked expectations.

 

There is an inherent tendency towards circularity in this synthesis, of course; for if the owner’s reasonable expectations are shaped by what courts allow as a proper exercise of governmental authority, property tends to become what courts say it is. Some circularity must be tolerated in these matters, however, as it is in other spheres. E. g., Katz v. United States, 389 U. S. 347 (1967) (Fourth Amendment protections defined by reasonable expectations of privacy). The definition, moreover, is not circular in its entirety. The expectations protected by the Constitution are based on objective rules and customs that can be understood as reasonable by all parties involved.

 

In my view, reasonable expectations must be understood in light of the whole of our legal tradition. The common law of nuisance is too narrow a confine for the exercise of regulatory power in a complex and interdependent society. Goldblatt v. Hempstead, 369 U. S. 590, 593 (1962). The State should not be prevented from enacting new regulatory initiatives in response to changing conditions, and courts must consider all reasonable expectations whatever their source. The Takings Clause does not require a static body of state property law; it protects private expectations to ensure private investment. I agree with the Court that nuisance prevention accords with the most common expectations of property owners who face regulation, but I do not believe this can be the sole source of state authority to impose severe restrictions. Coastal property may present such unique concerns for a fragile land system that the State can go further in regulating its development and use than the common law of nuisance might otherwise permit.

 

The Supreme Court of South Carolina erred, in my view, by reciting the general purposes for which the state regulations were enacted without a determination that they were in accord with the owner’s reasonable expectations and therefore sufficient to support a severe restriction on specific parcels of property. See 304 S. C. 376, 383, 404 S. E. 2d 895, 899 (1991). The promotion of tourism, for instance, ought not to suffice to deprive specific property of all value without a corresponding duty to compensate. Furthermore, the means, as well as the ends, of regulation must accord with the owner’s reasonable expectations. Here, the State did not act until after the property had been zoned for individual lot development and most other parcels had been improved, throwing the whole burden of the regulation on the remaining lots. This too must be measured in the balance. See Pennsylvania Coal Co. v. Mahon, 260 U. S. 393, 416 (1922).

 

With these observations, I concur in the judgment of the Court.

 

 

 

Justice Blackmun, dissenting.

 

 

 

Today the Court launches a missile to kill a mouse.

 

The State of South Carolina prohibited petitioner Lucas from building a permanent structure on his property from 1988 to 1990. Relying on an unreviewed (and implausible) state trial court finding that this restriction left Lucas’ property valueless, this Court granted review to determine whether compensation must be paid in cases where the State prohibits all economic use of real estate. According to the Court, such an occasion never has arisen in any of our prior cases, and the Court imagines that it will arise “relatively rarely” or only in “extraordinary circumstances.” Almost certainly it did not happen in this case.

 

Nonetheless, the Court presses on to decide the issue, and as it does, it ignores its jurisdictional limits, remakes its traditional rules of review, and creates simultaneously a new categorical rule and an exception (neither of which is rooted in our prior case law, common law, or common sense). I protest not only the Court’s decision, but each step taken to reach it. More fundamentally, I question the Court’s wisdom in issuing sweeping new rules to decide such a narrow case. Surely, as Justice Kennedy demonstrates, the Court could have reached the result it wanted without inflicting this damage upon our Takings Clause jurisprudence.

 

My fear is that the Court’s new policies will spread beyond the narrow confines of the present case. For that reason, I, like the Court, will give far greater attention to this case than its narrow scope suggests – not because I can intercept the Court’s missile, or save the targeted mouse, but because I hope perhaps to limit the collateral damage.

 

… .

 

 

 

Statement of Justice Souter.

 

 

 

I would dismiss the writ of certiorari in this case as having been granted improvidently. After briefing and argument it is abundantly clear that an unreviewable assumption on which this case comes to us is both questionable as a conclusion of Fifth Amendment law and sufficient to frustrate the Court’s ability to render certain the legal premises on which its holding rests.

 

The petition for review was granted on the assumption that the State by regulation had deprived the owner of his entire economic interest in the subject property. Such was the state trial court’s conclusion, which the State Supreme Court did not review. It is apparent now that in light of our prior cases, see, e. g., Keystone Bituminous Coal Assn. v. DeBenedictis, 480 U. S. 470, 493-502 (1987); Andrus v. Allard, 444 U. S. 51, 65-66 (1979); Penn Central Transportation Corp. v. New York City, 438 U. S. 104, 130-131 (1978), the trial court’s conclusion is highly questionable. While the respondent now wishes to contest the point, see Brief for Respondent 45-50, the Court is certainly right to refuse to take up the issue, which is not fairly included within the question presented, and has received only the most superficial and one-sided treatment before us.

 

Because the questionable conclusion of total deprivation cannot be reviewed, the Court is precluded from attempting to clarify the concept of total (and, in the Court’s view, categorically compensable) taking on which it rests, a concept which the Court describes, see ante, at 1016-1017, n. 6, as so uncertain under existing law as to have fostered inconsistent pronouncements by the Court itself. Because that concept is left uncertain, so is the significance of the exceptions to the compensation requirement that the Court proceeds to recognize. This alone is enough to show that there is little utility in attempting to deal with this case on the merits.

 

… .

 


    1. Briefs of amici curiae urging reversal were filed for the United States by Solicitor General Starr, Acting Assistant Attorney General Hartman, Deputy Solicitor General Wallace, Deputy Assistant Attorney General Clegg, Acting Deputy Assistant Attorney General Cohen, Edwin S. Kneedler, Peter R. Steenland, James E. Brookshire, John A. Bryson, and Martin W. Matzen; for United States Senator Steve Symms et al. by Peter D. Dickson, Howard E. Shapiro, and D. Eric Hultman; for the American Farm Bureau Federation et al. by James D. Holzhauer, Clifford M. Sloan, Timothy S. Bishop, John J. Rademacher, and Richard L. Krause; for the American Mining Congress et al. by George W. Miller, Walter A. Smith, Jr., Stuart A. Sanderson, William E. Hynan, and Robert A. Kirshner; for the Chamber of Commerce of the United States of America by Stephen A. Bokat, Robin S. Conrad, Herbert L. Fenster, and Tami Lyn Azorsky; for Defenders of Property Rights et al. by Nancy G. Marzulla; for the Fire Island Association, Inc., by Bernard S. Meyer; for the Institute for Justice by Richard A. Epstein, William H. Mellor III, Clint Bolick, and Jonathan W. Emord; for the Long Beach Island Oceanfront Homeowners Association et al. by Theodore J. Carlson; for the Mountain States Legal Foundation et al. by William Perry Pendley; for the National Association of Home Builders et al. by Michael M. Berger and William H. Ethier; for the Nemours Foundation, Inc., by John J. Mullenholz; for the Northern Virginia Chapter of the National Association of Industrial and Office Parks et al. by John Holland Foote and John F. Cahill; for the Pacific Legal Foundation by Ronald A. Zumbrun, Edward J. Connor, Jr., and R. S. Radford; and for the South Carolina Policy Council Education Foundation et al. by G. Stephen Parker.

       

      Briefs of amici curiae urging affirmance were filed for the State of California by Daniel E. Lungren, Attorney General, Roderick E. Walston, Chief Assistant Attorney General, Jan S. Stevens, Assistant Attorney General, Richard M. Frank and Craig C. Thompson, Supervising Deputy Attorneys General, and Maria Dante Brown and Virna L. Santos, Deputy Attorneys General; for the State of Florida et al. by Robert A. Butterworth, Attorney General of Florida, and Lewis F. Hubener, Assistant Attorney General, James H. Evans, Attorney General of Alabama, Richard Blumenthal, Attorney General of Connecticut, Charles M. Oberly III, Attorney General of Delaware, Michael J. Bowers, Attorney General of Georgia, Elizabeth Barrett-Anderson, Attorney General of Guam, Warren Price, Attorney General of Hawaii, Bonnie J. Campbell, Attorney General of Iowa, Michael E. Carpenter, Attorney General of Maine, J. Joseph Curran, Jr., Attorney General of Maryland, Scott Harshbarger, Attorney General of Massachusetts, Frank J. Kelley, Attorney General of Michigan, Hubert H. Humphrey III, Attorney General of Minnesota, Frankie Sue Del Papa, Attorney General of Nevada, Robert J. Del Tufo, Attorney General of New Jersey, John P. Arnold, Attorney General of New Hampshire, Tom Udall, Attorney General of New Mexico, Robert Abrams, Attorney General of New York, and Jerry Boone, Solicitor General, Lacy H. Thornburg, Attorney General of North Carolina, Charles S. Crookham, Attorney General of Oregon, Ernest D. Preate, Jr., Attorney General of Pennsylvania, Jorges Perez-Diaz, Attorney General of Puerto Rico, James E. O’Neil, Attorney General of Rhode Island, Paul Van Dam, Attorney General of Utah, Jeffrey L. Amestoy, Attorney General of Vermont, James E. Doyle, Attorney General of Wisconsin, Dan Morales, Attorney General of Texas, and Brian A. Goldman ; for Broward County et al. by John J. Copelan, Jr., Herbert W. A. Thiele, and H. Hamilton Rice, Jr.; for California Cities and Counties by Robin D. Faisant, Gary T. Ragghianti, Manuela Albuquerque, F. Thomas Caporael, William Camil, Scott H. Howard, Roger Picquet, Joseph Barron, David J. Erwin, Charles J. Williams, John Calhoun, Robert K. Booth, Jr., Anthony S. Alperin, Leland H. Jordan, John L. Cook, Jayne Williams, Gary L. Gillig, Dave Larsen, Don G. Kircher, Jean Leonard Harris, Michael F. Dean, John W. Witt, C. Alan Sumption, Joan Gallo, George Rios, Daniel S. Hentschke, Joseph Lawrence, Peter Bulens, and Thomas Haas; for Nueces County, Texas, et al. by Peter A. A. Berle, Glenn P. Sugameli, Ann Powers, and Zygmunt J. B. Plater; for the American Planning Association et al. by H. Bissell Carey III and Gary A. Owen; for Members of the National Growth Management Leadership Project by John A. Humbach; for the Municipal Art Society of New York, Inc., by William E. Hegarty, Michael S. Gruen, Philip K. Howard, Norman Marcus, andPhilip Weinberg; for the National Trust for Historic Preservation in the United States by Lloyd N. Cutler, Louis R. Cohen, David R. Johnson, Peter B. Hutt II, Jerold S. Kayden, David A. Doheny, and Elizabeth S. Merritt; for the Sierra Club et al. by Lawrence N. Minch, Laurens H. Silver, and Charles M. Chambers; and for the U. S. Conference of Mayors et al.by Richard Ruda, Michael G. Dzialo, and Barbara Etkind.

       

      Briefs of amici curiae were filed for the National Association of Realtors by Ralph W. Holmen; and for the Washington Legal Foundation by Daniel J. Popeo and Paul D. Kamenar.

 

    1. This specialized historical method of determining the baseline applied because the Beachwood East subdivision is located adjacent to a so-called “inlet erosion zone” (defined in the Act to mean “a segment of shoreline along or adjacent to tidal inlets which are directly influenced by the inlet and its associated shoals,”S. C. Code Ann. § 48-39-270(7) (Supp.1988)) that is”not stabilized by jetties,terminal groins, or other structures,” § 48-39-280(A)(2).For areas other than these unstabilized inlet erosion zones, the statute directs that the baseline be established along “the crest of an ideal primary oceanfront sand dune.”§ 48-39-280(A)(1).

 

    1. The Act did allow the construction of certain nonhabitable improvements, e. g., “wooden walkways no larger in width than six feet,” and “small wooden decks no larger than one hundred forty-four square feet.” §§ 48-39-290(A)(1) and (2).

 

    1. We will not attempt to respond to all of Justice Blackmun’s mistaken citation of case precedent. Characteristic of its nature is his assertion that the cases we discuss here stand merely for the proposition “that proof that a regulation does not deny an owner economic use of his property is sufficient to defeat a facial takings challenge” and not for the point that ”denial of such use is sufficient to establish a takings claim regardless of any other consideration.” Post, at 1050, n. 11. The cases say, repeatedly and unmistakably, that ”’[t]he test to be applied in considering [a] facial [takings] challenge is fairly straightforward. A statute regulating the uses that can be made of property effects a taking if it “denies an owner economically viable use of his land. ”’ ” Keystone, 480 U. S., at 495 (quoting Hodel, 452 U. S., at 295-296 (quoting Agins, 447 U. S., at 260)) (emphasis added).

       

      Justice Blackmun describes that rule (which we do not invent but merely apply today) as “alter[ing] the long-settled rules of review” by foisting on the State “the burden of showing [its]regulation is not a taking.” Post, at 1045, 1046. This is of course wrong. Lucas had to do more than simply file a lawsuit to establish his constitutional entitlement; he had to show that the Beachfront Management Act denied him economically beneficial use of his land. Our analysis presumes the unconstitutionality of state land-use regulation only in the sense that any rule with exceptions presumes the invalidity of a law that violates it–for example, the rule generally prohibiting content-based restrictions on speech. See, e. g., em>Simon & Schuster, Inc. v. Members of N. Y. State Crime Victims Bd., 502 U. S. 105, 115 (1991) (“A statute is presumptively inconsistent with the First Amendment if it imposes a financial burden on speakers because of the content of their speech”). Justice Blackmun’s real quarrel is with the substantive standard of liability we apply in this case, a longestablished standard we see no need to repudiate.

 

    1. Regrettably, the rhetorical force of our “deprivation of all economically feasible use” rule is greater than its precision, since the rule does not make clear the “property interest” against which the loss of value is to be measured. When, for example, a regulation requires a developer to leave 90% of a rural tract in its natural state, it is unclear whether we would analyze the situation as one in which the owner has been deprived of all economically beneficial use of the burdened portion of the tract, or as one in which the owner has suffered a mere diminution in value of the tract as a whole. (For an extreme–and, we think, unsupportable–view of the relevant calculus, see Penn Central Transportation Co. v. New York City, 42 N. Y. 2d 324, 333-334, 366 N. E. 2d 1271, 1276-1277 (1977), aff’d, 438 U. S. 104 (1978), where the state court examined the diminution in a particular parcel’s value produced by a municipal ordinance in light of total value of the takings claimant’s other holdings in the vicinity.) Unsurprisingly, this uncertainty regarding the composition of the denominator in our “deprivation” fraction has produced inconsistent pronouncements by the Court. Compare Pennsylvania Coal Co. v. Mahon, 260 U. S. 393, 414 (1922) (law restricting subsurface extraction of coal held to effect a taking), with Keystone Bituminous Coal Assn. v. DeBenedictis, 480 U. S. 470, 497-502 (1987) (nearly identical law held not to effect a taking); see also id., at 515-520 (Rehnquist, C. J., dissenting); Rose, Mahon Reconstructed: Why the Takings Issue is Still a Muddle, 57 S. Cal. L. Rev. 561, 566-569 (1984). The answer to this difficult question may lie in how the owner’s reasonable expectations have been shaped by the State’s law of property–i. e., whether and to what degree the State’s law has accorded legal recognition and protection to the particular interest in land with respect to which the takings claimant alleges a diminution in (or elimination of) value. In any event, we avoid this difficulty in the present case, since the “interest in land” that Lucas has pleaded (a fee simple interest) is an estate with a rich tradition of protection at common law, and since the South Carolina Court of Common Pleas found that the Beachfront Management Act left each of Lucas’s beachfront lots without economic value.

 

    1. Justice Stevens criticizes the “deprivation of all economically beneficial use” rule as “wholly arbitrary,” in that “[the] landowner whose property is diminished in value 95% recovers nothing,” while the landowner who suffers a complete elimination of value “recovers the land’s full value.” Post, at 1064. This analysis errs in its assumption that the landowner whose deprivation is one step short of complete is not entitled to compensation. Such an owner might not be able to claim the benefit of our categorical formulation, but, as we have acknowledged time and again, “[t]he economic impact of the regulation on the claimant and …the extent to which the regulation has interfered with distinct investment-backed expectations” are keenly relevant to takings analysis generally. Penn Central Transportation Co. v. New York City, 438 U. S. 104, 124 (1978). It is true that in at least some cases the landowner with 95% loss will get nothing, while the landowner with total loss will recover in full. But that occasional result is no more strange than the gross disparity between the landowner whose premises are taken for a highway (who recovers in full) and the landowner whose property is reduced to 5% of its former value by the highway (who recovers nothing). Takings law is full of these “allor-nothing” situations.

       

      Justice Stevens similarly misinterprets our focus on “developmental” uses of property (the uses proscribed by the Beachfront Management Act) as betraying an “assumption that the only uses of property cognizable under the Constitution are developmental uses.” Post, at 1065, n. 3. We make no such assumption. Though our prior takings cases evince an abiding concern for the productive use of, and economic investment in, land, there are plainly a number of noneconomic interests in land whose impairment will invite exceedingly close scrutiny under the Takings Clause. See, e. g., Loretto v. Teleprompter Manhattan CATV Corp., 458 U. S. 419, 436 (1982) (interest in excluding strangers from one’s land).

 

    1. This finding was the premise of the petition for certiorari, and since it was not challenged in the brief in opposition we decline to entertain the argument in respondent’s brief on the merits, see Brief for Respondent 45-50, that the finding was erroneous. Instead, we decide the question presented under the same factual assumptions as did the Supreme Court of South Carolina. See Oklahoma City v. Tuttle, 471 U. S. 808, 816 (1985).

 

    1. The legislature’s express findings include the following:

       

      “The General Assembly finds that:

       

      “(1) The beach/dune system along the coast of South Carolina is extremely important to the people of this State and serves the following functions:

       

      “(a) protects life and property by serving as a storm barrier which dissipates wave energy and contributes to shoreline stability in an economical and effective manner;

       

      “(b) provides the basis for a tourism industry that generates approximately two-thirds of South Carolina’s annual tourism industry revenue which constitutes a significant portion of the state’s economy. The tourists who come to the South Carolina coast to enjoy the ocean and dry sand beach contribute significantly to state and local tax revenues;

       

      “(c) provides habitat for numerous species of plants and animals, several of which are threatened or endangered. Waters adjacent to the beach/ dune system also provide habitat for many other marine species;

       

      “(d) provides a natural health environment for the citizens of South Carolina to spend leisure time which serves their physical and mental wellbeing.

       

      “(2) Beach/dune system vegetation is unique and extremely important to the vitality and preservation of the system.

       

      “(3) Many miles of South Carolina’s beaches have been identified as critically eroding.

       

      “(4) … [D]evelopment unwisely has been sited too close to the [beach/ dune] system. This type of development has jeopardized the stability of the beach/dune system, accelerated erosion, and endangered adjacent property. It is in both the public and private interests to protect the system from this unwise development.

       

      “(5) The use of armoring in the form of hard erosion control devices such as seawalls, bulkheads, and rip-rap to protect erosion-threatened structures adjacent to the beach has not proven effective. These armoring devices have given a falsesense of security to beachfront property owners. In reality, these hard structures, in many instances, have increased the vulnerability of beachfront property to damage from wind and waves while contributing to the deterioration and loss of the dry sand beach which is so important to the tourism industry.

       

      “(6) Erosion is a natural process which becomes a significant problem for man only when structures are erected in close proximity to the beach/ dune system. It is in both the public and private interests to afford the beach/dune system space to accrete and erode in its natural cycle. This space can be provided only by discouraging new construction in close proximity to the beach/dune system and encouraging those who have erected structures too close to the system to retreat from it.

       

      … . .

       

      “(8) It is in the state’s best interest to protect and to promote increased public access to South Carolina’s beaches for out-of-state tourists and South Carolina residents alike.” S. C. Code Ann. § 48-39-250 (Supp. 1991).

 

    1. In the present case, in fact, some of the “[South Carolina] legislature’s ‘findings’ ” to which the South Carolina Supreme Court purported to defer in characterizing the purpose of the Act as “harm-preventing,” 304 S. C. 376, 385, 404 S. E. 2d 895, 900 (1991), seem to us phrased in “benefitconferring” language instead. For example, they describe the importance of a construction ban in enhancing “South Carolina’s annual tourism industry revenue,” S. C. Code Ann. § 48-39-250(1)(b) (Supp. 1991), in “provid[ing] habitat for numerous species of plants and animals, several of which are threatened or endangered,” § 48-39-250(1)(c), and in “provid[ing] a natural healthy environment for the citizens of South Carolina to spend leisure time which serves their physical and mental well-being,” § 48-39-250(1)(d). It would be pointless to make the outcome of this case hang upon this terminology, since the same interests could readily be described in “harm-preventing” fashion.

       

      Justice Blackmun, however, apparently insists that we must make the outcome hinge (exclusively) upon the South Carolina Legislature’s other, “harm-preventing” characterizations, focusing on the declaration that “prohibitions on building in front of the setback line are necessary to protect people and property from storms, high tides, and beach erosion.” Post, at 1040. He says “[n]othing in the record undermines [this] assessment,” ibid., apparently seeing no significance in the fact that the statute permits owners of existing structures to remain (and even to rebuild if their structures are not “destroyed beyond repair,” S. C. Code Ann. § 48-39-290(B) (Supp. 1988)), and in the fact that the 1990 amendment authorizes the Council to issue permits for new construction in violation of the uniform prohibition, see S. C. Code Ann. § 48-39-290(D)(1) (Supp. 1991).

 

    1. In Justice Blackmun’s view, even with respect to regulations that deprive an owner of all developmental or economically beneficial land uses, the test for required compensation is whether the legislature has recited a harm-preventing justification for its action. See post, at 1039, 1040-1041, 1047-1051. Since such a justification can be formulated in practically every case, this amounts to a test of whether the legislature has a stupid staff. We think the Takings Clause requires courts to do more than insist upon artful harm-preventing characterizations.

 

    1. E. g., Mugler v. Kansas, 123 U. S. 623 (1887) (prohibition upon use of a building as a brewery; other uses permitted); Plymouth Coal Co. v. Pennsylvania, 232 U. S. 531 (1914) (requirement that “pillar” of coal be left in ground to safeguard mine workers; mineral rights could otherwise be exploited); Reinman v.Little Rock, 237 U. S. 171 (1915) (declaration that livery stable constituted a public nuisance; other uses of the property permitted); Hadacheck v. Sebastian, 239 U. S. 394 (1915) (prohibition of brick manufacturing in residential area; other uses permitted); Goldblatt v. Hempstead, 369 U. S. 590 (1962) (prohibition on excavation; other uses permitted).

 

    1. Drawing on our First Amendment jurisprudence, see, e. g., Employment Div., Dept. of Human Resources of Ore. v. Smith, 494 U. S. 872, 878-879 (1990), Justice Stevens would “loo[k] to the generality of a regulation of property” to determine whether compensation is owing. Post, at 1072. The Beach front Management Act is general, in his view, because it “regulates the use of the coastline of the entire State.” Post, at 1074. There may be some validity to the principle Justice Stevens proposes, but it does not properly apply to the present case. The equivalent of a law of general application that inhibits the practice of religion without being aimed at religion, see Oregon v. Smith, supra, is a law that destroys the value of land without being aimed at land. Perhaps such a law – the generally applicable criminal prohibition on the manufacturing of alcoholic beverages challenged in Mugler comes to mind – cannot constitute a compensable taking. See 123 U. S., at 655-656. But a regulation specifically directed to land use no more acquires immunity by plundering landowners generally than does a law specifically directed at religious practice acquire immunity by prohibiting all religions. Justice Stevens’s approach renders the Takings Clause little more than a particularized restatement of the Equal Protection Clause.

 

    1. After accusing us of “launch[ing] a missile to kill a mouse,” post, at 1036, Justice Blackmun expends a good deal of throw-weight of his own upon a noncombatant, arguing that our description of the “understanding” of land ownership that informs the Takings Clause is not supported by early American experience. That is largely true, but entirely irrelevant. The practices of the States prior to incorporation of the Takings and Just Compensation Clauses, see Chicago, B. & Q. R. Co. v. Chicago, 166 U. S. 226 (1897) – which, as Justice Blackmun acknowledges, occasionally included outright physical appropriation of land without compensation, see post, at 1056 – were out of accord with any plausible interpretation of those provisions. Justice Blackmun is correct that early constitutional theorists did not believe the Takings Clause embraced regulations of property at all, see post, at 1057-1058, and n. 23, but even he does not suggest (explicitly, at least) that we renounce the Court’s contrary conclusion in Mahon. Since the text of the Clause can be read to encompass regulatory as well as physical deprivations (in contrast to the text originally proposed by Madison, see Speech Proposing Bill of Rights (June 8, 1789), in 12 J. Madison, The Papers of James Madison 201 (C. Hobson, R. Rutland, W. Rachal, & J. Sisson ed. 1979) (“No person shall be … obliged to relinquish his property, where it may be necessary for public use, without a just compensation”), we decline to do so as well.

 

    1. The principal “otherwise” that we have in mind is litigation absolving the State (or private parties) of liability for the destruction of “real and personal property, in cases of actual necessity, to prevent the spreading of a fire” or to forestall other grave threats to the lives and property of others. Bowditch v. Boston, 101 U. S. 16, 18-19 (1880); see United States v. Pacific R. Co., 120 U. S. 227, 238-239 (1887).

 

    1. Of course, the State may elect to rescind its regulation and thereby avoid having to pay compensation for a permanent deprivation. See First English Evangelical Lutheran Church, 482 U. S., at 321. But “where the [regulation has] already worked a taking of all use of property, no subsequent action by the government can relieve it of the duty to provide compensation for the period during which the taking was effective.” Ibid.

 

    1. Justice Blackmun decries our reliance on background nuisance principles at least in part because he believes those principles to be as manipulable as we find the “harm prevention”/”benefit conferral” dichotomy, see post, at 1054-1055. There is no doubt some leeway in a court’s interpretation of what existing state law permits – but not remotely as much, we think, as in a legislative crafting of the reasons for its confiscatory regulation. We stress that an affirmative decree eliminating all economically beneficial uses may be defended only if an objectively reasonable application of relevant precedents would exclude those beneficial uses in the circumstances in which the land is presently found.

 

 

 

Tahoe-Sierra Preservation Council, Inc. v. Tahoe Regional Planning Agency,

535 U.S. 302 (2002)

 

 

 

 

 

Michael M. Berger argued the cause for petitioners. With him on the briefs were Gideon Kannerand Lawrence L. Hoffman.

 

John G. Roberts, Jr., argued the cause for respondents. With him on the brief were Frankie Sue Del Papa, Attorney General of Nevada, and William J. Frey, Deputy Attorney General, Bill Lockyer, Attorney General of California, Richard M. Frank, Chief Assistant Attorney General, Matthew Rodriquez, Senior Assistant Attorney General, and Daniel L. Siegel, Supervising Deputy Attorney General, E. Clement Shute, Jr., Fran M. Layton, Ellison Folk, John L. Marshall, and Richard J. Lazarus.

 

Solicitor General Olson argued the cause for the United States as amicus curiae urging affirmance. With him on the brief were Acting Assistant Attorney General Cruden, Deputy Solicitor General Kneedler, and Malcolm L. Stewart.

 

 

 

Justice Stevens delivered the opinion of the Court.

 

 

 

The question presented is whether a moratorium on development imposed during the process of devising a comprehensive land-use plan constitutes a per se taking of property requiring compensation under the Takings Clause of the United States Constitution.1 This case actually involves two moratoria ordered by respondent Tahoe Regional Planning Agency (TRPA) to maintain the status quo while studying the impact of development on Lake Tahoe and designing a strategy for environmentally sound growth. The first, Ordinance 81-5, was effective from August 24, 1981, until August 26, 1983, whereas the second more restrictive Resolution 83-21 was in effect from August 27, 1983, until April 25, 1984. As a result of these two directives, virtually all development on a substantial portion of the property subject to TRPA’s jurisdiction was prohibited for a period of 32 months. Although the question we decide relates only to that 32-month period, a brief description of the events leading up to the moratoria and a comment on the two permanent plans that TRPA adopted thereafter will clarify the narrow scope of our holding.

 

 

 

 

I

 

 

 

 

The relevant facts are undisputed. The Court of Appeals, while reversing the District Court on a question of law, accepted all of its findings of fact, and no party challenges those findings. All agree that Lake Tahoe is “uniquely beautiful,” 34 F. Supp. 2d 1226, 1230 (Nev. 1999), that President Clinton was right to call it a “‘national treasure that must be protected and preserved,’ ” ibid., and that Mark Twain aptly described the clarity of its waters as “‘not merely transparent, but dazzlingly, brilliantly so,’ ” ibid. (emphasis added) (quoting M. Twain, Roughing It 174-175 (1872)).

 

Lake Tahoe’s exceptional clarity is attributed to the absence of algae that obscures the waters of most other lakes. Historically, the lack of nitrogen and phosphorous, which nourish the growth of algae, has ensured the transparency of its waters.2 Unfortunately, the lake’s pristine state has deteriorated rapidly over the past 40 years; increased land development in the Lake Tahoe Basin (Basin) has threatened the “‘noble sheet of blue water’ ” beloved by Twain and countless others. 34 F. Supp. 2d, at 1230. As the District Court found, “[d]ramatic decreases in clarity first began to be noted in the late 1950’s/early 1960’s, shortly after development at the lake began in earnest.” Id., at 1231. The lake’s unsurpassed beauty, it seems, is the wellspring of its undoing.

 

The upsurge of development in the area has caused “increased nutrient loading of the lake largely because of the increase in impervious coverage of land in the Basin resulting from that development.” Ibid.

 

[The Court recounts the history of inter-governmental cooperation and land use regulations since the 1960s that have attempted to solve the water quality problems. A three-year moratorium was imposed while TRPA developed a regional water quality plan. When that plan was complete, California sued, alleging the plan was inadequate to protect Lake Tahoe. The federal court entered an injunction that essentially continued the moratorium for another three years, until 1987 when a new regional plan was completed. Around the same time that California filed suit, Petitioners –- a total of around 2,400 landowners -– also filed their suit, seeking compensation for the moratorium that had been in effect from 1981-1984. That litigation became protracted “produc[ing] four opinions by the Court of Appeals for the Ninth Circuit and several published District Court opinions.” The majority in this case held that only the 1981 moratorium, not the additional delay caused by the federal injunction was before it. It also characterized Petitioners as mounting only a facial challenge to the moratorium. “For petitioners, it is enough that a regulation imposes a temporary deprivation–no matter how brief–of all economically viable use to trigger a per se rule that a taking has occurred.”]

 

 

 

 

IV

 

 

 

 

The text of the Fifth Amendment itself provides a basis for drawing a distinction between physical takings and regulatory takings. Its plain language requires the payment of compensation whenever the government acquires private property for a public purpose, whether the acquisition is the result of a condemnation proceeding or a physical appropriation. But the Constitution contains no comparable reference to regulations that prohibit a property owner from making certain uses of her private property.3 Our jurisprudence involving condemnations and physical takings is as old as the Republic and, for the most part, involves the straightforward application of per se rules. Our regulatory takings jurisprudence, in contrast, is of more recent vintage and is characterized by “essentially ad hoc, factual inquiries,” Penn Central, 438 U. S., at 124, designed to allow “careful examination and weighing of all the relevant circumstances.” Palazzolo, 533 U. S., at 636 (O’Connor, J., concurring).

 

When the government physically takes possession of an interest in property for some public purpose, it has a categorical duty to compensate the former owner, United States v. Pewee Coal Co., 341 U. S. 114, 115 (1951), regardless of whether the interest that is taken constitutes an entire parcel or merely a part thereof. Thus, compensation is mandated when a leasehold is taken and the government occupies the property for its own purposes, even though that use is temporary. United States v. General Motors Corp., 323 U. S. 373 (1945); United States v. Petty Motor Co., 327 U. S. 372 (1946). Similarly, when the government appropriates part of a roof top in order to provide cable TV access for apartment tenants, Loretto v. Teleprompter Manhattan CATV Corp., 458 U. S. 419 (1982); or when its planes use private airspace to approach a government airport, United States v. Causby, 328 U. S. 256 (1946), it is required to pay for that share no matter how small. But a government regulation that merely prohibits landlords from evicting tenants unwilling to pay a higher rent, Block v. Hirsh, 256 U. S. 135 (1921); that bans certain private uses of a portion of an owner’s property, Village of Euclid v. Ambler Realty Co., 272 U. S. 365 (1926); Keystone Bituminous Coal Assn. v. DeBenedictis, 480 U. S. 470 (1987); or that forbids the private use of certain airspace, Penn Central Transp. Co. v. New York City, 438 U. S. 104 (1978), does not constitute a categorical taking. “The first category of cases requires courts to apply a clear rule; the second necessarily entails complex factual assessments of the purposes and economic effects of government actions.” Yee v. Escondido, 503 U. S. 519, 523 (1992). See also Loretto, 458 U. S., at 440; Keystone, 480 U. S., at 489, n. 18.

 

This longstanding distinction between acquisitions of property for public use, on the one hand, and regulations prohibiting private uses, on the other, makes it inappropriate to treat cases involving physical takings as controlling precedents for the evaluation of a claim that there has been a “regulatory taking,”4 and vice versa. For the same reason that we do not ask whether a physical appropriation advances a substantial government interest or whether it deprives the owner of all economically valuable use, we do not apply our precedent from the physical takings context to regulatory takings claims. Land-use regulations are ubiquitous and most of them impact property values in some tangential way–often in completely unanticipated ways. Treating them all as per se takings would transform government regulation into a luxury few governments could afford. By contrast, physical appropriations are relatively rare, easily identified, and usually represent a greater affront to individual property rights.5 “This case does not present the ‘classi[c] taking’ in which the government directly appropriates private property for its own use,”Eastern Enterprises v. Apfel, 524 U. S. 498, 522 (1998); instead the interference with property rights “arises from some public program adjusting the benefits and burdens of economic life to promote the common good,” Penn Central, 438 U. S., at 124.

 

Perhaps recognizing this fundamental distinction, petitioners wisely do not place all their emphasis on analogies to physical takings cases. Instead, they rely principally on our decision in Lucas v. South Carolina Coastal Council, 505 U. S. 1003 (1992)–a regulatory takings case that, nevertheless, applied a categorical rule–to argue that the Penn Central framework is inapplicable here. A brief review of some of the cases that led to our decision in Lucas, however, will help to explain why the holding in that case does not answer the question presented here.

 

As we noted in Lucas, it was Justice Holmes’ opinion in Pennsylvania Coal Co. v. Mahon, 260 U. S. 393 (1922),6 that gave birth to our regulatory takings jurisprudence.7 In subsequent opinions we have repeatedly and consistently endorsed Holmes’ observation that “if regulation goes too far it will be recognized as a taking.” Id., at 415. Justice Holmes did not provide a standard for determining when a regulation goes “too far,” but he did reject the view expressed in Justice Brandeis’ dissent that there could not be a taking because the property remained in the possession of the owner and had not been appropriated or used by the public.8 After Mahon, neither a physical appropriation nor a public use has ever been a necessary component of a “regulatory taking.”

 

In the decades following that decision, we have “generally eschewed” any set formula for determining how far is too far, choosing instead to engage in “‘essentially ad hoc, factual inquiries.’ ” Lucas, 505 U. S., at 1015 (quoting Penn Central, 438 U. S., at 124). Indeed, we still resist the temptation to adopt per se rules in our cases involving partial regulatory takings, preferring to examine “a number of factors” rather than a simple “mathematically precise” formula.9 Justice Brennan’s opinion for the Court in Penn Central did, however, make it clear that even though multiple factors are relevant in the analysis of regulatory takings claims, in such cases we must focus on “the parcel as a whole”:

 

 

“‘Taking’ jurisprudence does not divide a single parcel into discrete segments and attempt to determine whether rights in a particular segment have been entirely abrogated. In deciding whether a particular governmental action has effected a taking, this Court focuses rather both on the character of the action and on the nature and extent of the interference with rights in the parcel as a whole–here, the city tax block designated as the ‘landmark site.’ ” Id., at 130-131.

 

 

This requirement that “the aggregate must be viewed in its entirety” explains why, for example, a regulation that prohibited commercial transactions in eagle feathers, but did not bar other uses or impose any physical invasion or restraint upon them, was not a taking. Andrus v. Allard, 444 U. S. 51, 66 (1979). It also clarifies why restrictions on the use of only limited portions of the parcel, such as setback ordinances, Gorieb v. Fox, 274 U. S. 603 (1927), or a requirement that coal pillars be left in place to prevent mine subsidence, Keystone Bituminous Coal Assn. v. DeBenedictis, 480 U. S., at 498, were not considered regulatory takings. In each of these cases, we affirmed that “where an owner possesses a full ‘bundle’ of property rights, the destruction of one ‘strand’ of the bundle is not a taking.” Andrus, 444 U. S., at 65-66.

 

While the foregoing cases considered whether particular regulations had “gone too far” and were therefore invalid, none of them addressed the separate remedial question of how compensation is measured once a regulatory taking is established. In his dissenting opinion in San Diego Gas & Elec. Co. v. San Diego, 450 U. S. 621, 636 (1981), Justice Brennan identified that question and explained how he would answer it:

 

 

“The constitutional rule I propose requires that, once a court finds that a police power regulation has effected a ‘taking,’ the government entity must pay just compensation for the period commencing on the date the regulation first effected the ‘taking,’ and ending on the date the government entity chooses to rescind or otherwise amend the regulation.” Id., at 658.

 

 

Justice Brennan’s proposed rule was subsequently endorsed by the Court in First English, 482 U. S., at 315, 318, 321. First English was certainly a significant decision, and nothing that we say today qualifies its holding. Nonetheless, it is important to recognize that we did not address in that case the quite different and logically prior question whether the temporary regulation at issue had in fact constituted a taking.

 

In First English, the Court unambiguously and repeatedly characterized the issue to be decided as a “compensation question” or a “remedial question.” Id., at 311 (“The disposition of the case on these grounds isolates the remedial question for our consideration”); see also id., at 313, 318. And the Court’s statement of its holding was equally unambiguous: “We merely hold that where the government’s activities have already worked a taking of all use of property, no subsequent action by the government can relieve it of the duty to provide compensation for the period during which the taking was effective.” Id., at 321 (emphasis added). In fact, First English expressly disavowed any ruling on the merits of the takings issue because the California courts had decided the remedial question on the assumption that a taking had been alleged. Id., at 312-313 (“We reject appellee’s suggestion that … we must independently evaluate the adequacy of the complaint and resolve the takings claim on the merits before we can reach the remedial question”). After our remand, the California courts concluded that there had not been a taking, First English Evangelical Church of Glendale v. County of Los Angeles, 210 Cal. App. 3d 1353, 258 Cal. Rptr. 893 (1989), and we declined review of that decision, 493 U. S. 1056 (1990).

 

To the extent that the Court in First English referenced the antecedent takings question, we identified two reasons why a regulation temporarily denying an owner all use of her property might not constitute a taking. First, we recognized that “the county might avoid the conclusion that a compensable taking had occurred by establishing that the denial of all use was insulated as a part of the State’s authority to enact safety regulations.” 82 U. S., at 313. Second, we limited our holding “to the facts presented” and recognized “the quite different questions that would arise in the case of normal delays in obtaining building permits, changes in zoning ordinances, variances, and the like which [were] not before us.” Id., at 321. Thus, our decision in First English surely did not approve, and implicitly rejected, the categorical submission that petitioners are now advocating.

 

Similarly, our decision in Lucas is not dispositive of the question presented. Although Lucas endorsed and applied a categorical rule, it was not the one that petitioners propose. Lucas purchased two residential lots in 1988 for $975,000. These lots were rendered “valueless” by a statute enacted two years later. The trial court found that a taking had occurred and ordered compensation of $1,232,387.50, representing the value of the fee simple estate, plus interest. As the statute read at the time of the trial, it effected a taking that “was unconditional and permanent.” 505 U. S., at 1012. While the State’s appeal was pending, the statute was amended to authorize exceptions that might have allowed Lucas to obtain a building permit. Despite the fact that the amendment gave the State Supreme Court the opportunity to dispose of the appeal on ripeness grounds, it resolved the merits of the permanent takings claim and reversed. Since “Lucas had no reason to proceed on a ‘temporary taking’ theory at trial,” we decided the case on the permanent taking theory that both the trial court and the State Supreme Court had addressed. Ibid.

 

The categorical rule that we applied in Lucas states that compensation is required when a regulation deprives an owner of ”all economically beneficial uses” of his land. Id., at 1019. Under that rule, a statute that “wholly eliminated the value” of Lucas’ fee simple title clearly qualified as a taking. But our holding was limited to “the extraordinary circumstance when no productive or economically beneficial use of land is permitted.” Id., at 1017. The emphasis on the word “no” in the text of the opinion was, in effect, reiterated in a footnote explaining that the categorical rule would not apply if the diminution in value were 95% instead of 100%. Id., at 1019, n. 8.10 Anything less than a “complete elimination of value,” or a “total loss,” the Court acknowledged, would require the kind of analysis applied in Penn Central. Lucas, 505 U. S., at 1019-1020, n. 8.11

 

Certainly, our holding that the permanent “obliteration of the value” of a fee simple estate constitutes a categorical taking does not answer the question whether a regulation prohibiting any economic use of land for a 32-month period has the same legal effect. Petitioners seek to bring this case under the rule announced in Lucas by arguing that we can effectively sever a 32-month segment from the remainder of each landowner’s fee simple estate, and then ask whether that segment has been taken in its entirety by the moratoria. Of course, defining the property interest taken in terms of the very regulation being challenged is circular. With property so divided, every delay would become a total ban; the moratorium and the normal permit process alike would constitute categorical takings. Petitioners’ “conceptual severance” argument is unavailing because it ignores Penn Central ‘s admonition that in regulatory takings cases we must focus on “the parcel as a whole.” 438 U. S., at 130– 131. We have consistently rejected such an approach to the “denominator” question. See Keystone, 480 U. S., at 497. See also Concrete Pipe & Products of Cal., Inc. v. Construction Laborers Pension Trust for Southern Cal., 508 U. S. 602, 644 (1993) (“To the extent that any portion of property is taken, that portion is always taken in its entirety; the relevant question, however, is whether the property taken is all, or only a portion of, the parcel in question”). Thus, the District Court erred when it disaggregated petitioners’ property into temporal segments corresponding to the regulations at issue and then analyzed whether petitioners were deprived of all economically viable use during each period. 34 F. Supp. 2d, at 1242-1245. The starting point for the court’s analysis should have been to ask whether there was a total taking of the entire parcel; if not, then Penn Central was the proper framework.12

 

An interest in real property is defined by the metes and bounds that describe its geographic dimensions and the term of years that describes the temporal aspect of the owner’s interest. See Restatement of Property §§ 7-9 (1936). Both dimensions must be considered if the interest is to be viewed in its entirety. Hence, a permanent deprivation of the owner’s use of the entire area is a taking of “the parcel as a whole,” whereas a temporary restriction that merely causes a diminution in value is not. Logically, a fee simple estate cannot be rendered valueless by a temporary prohibition on economic use, because the property will recover value as soon as the prohibition is lifted. Cf. Agins v. City of Tiburon, 447 U. S., at 263, n. 9 (“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 decisionmaking, absent extraordinary delay, are ‘incidents of ownership. They cannot be considered as a “taking” in the constitutional sense’ ” (quoting Danforth v. United States, 308 U. S. 271, 285 (1939))).

 

Neither Lucas, nor First English, nor any of our other regulatory takings cases compels us to accept petitioners’ categorical submission. In fact, these cases make clear that the categorical rule in Lucas was carved out for the “extraordinary case” in which a regulation permanently deprives property of all value; the default rule remains that, in the regulatory taking context, we require a more fact specific inquiry. Nevertheless, we will consider whether the interest in protecting individual property owners from bearing public burdens “which, in all fairness and justice, should be borne by the public as a whole,” Armstrong v. United States, 364 U. S., at 49, justifies creating a new rule for these circumstances.13

 

 

 

 

V

 

 

 

 

Considerations of “fairness and justice” arguably could support the conclusion that TRPA’s moratoria were takings of petitioners’ property based on any of seven different theories. First, even though we have not previously done so, we might now announce acategorical rule that, in the interest of fairness and justice, compensation is required whenever government temporarily deprives an owner of all economically viable use of her property. Second, we could craft a narrower rule that would cover all temporary landuse restrictions except those “normal delays in obtaining building permits, changes in zoning ordinances, variances, and the like” which were put to one side in our opinion in First English, 482 U. S., at 321. Third, we could adopt a rule like the one suggested by an amicus supporting petitioners that would “allow a short fixed period for deliberations to take place without compensation–say maximum one year–after which the just compensation requirements” would “kick in.”14 Fourth, with the benefit of hindsight, we might characterize the successive actions of TRPA as a “series of rolling moratoria” that were the functional equivalent of a permanent taking.15 Fifth, were it not for the findings of the District Court that TRPA acted diligently and in good faith, we might have concluded that the agency was stalling in order to avoid promulgating the environmental threshold carrying capacities and regional plan mandated by the 1980 Compact. Cf. Monterey v. Del Monte Dunes at Monterey, Ltd., 526 U. S. 687, 698 (1999). Sixth, apart from the District Court’s finding that TRPA’s actions represented a proportional response to a serious risk of harm to the lake, petitioners might have argued that the moratoria did not substantially advance a legitimate state interest, see Agins and Monterey. Finally, if petitioners had challenged the application of the moratoria to their individual parcels, instead of making a facial challenge, some of them might have prevailed under a Penn Central analysis.

 

As the case comes to us, however, none of the last four theories is available. The “rolling moratoria” theory was presented in the petition for certiorari, but our order granting review did not encompass that issue, 533 U. S. 948 (2001); the case was tried in the District Court and reviewed in the Court of Appeals on the theory that each of the two moratoria was a separate taking, one for a 2-year period and the other for an 8-month period. 216 F. 3d, at 769. And, as we have already noted, recovery on either a bad faith theory or a theory that the state interests were insubstantial is foreclosed by the District Court’s unchallenged findings of fact. Recovery under a Penn Central analysis is also foreclosed both because petitioners expressly disavowed that theory, and because they did not appeal from the District Court’s conclusion that the evidence would not support it. Nonetheless, each of the three per se theories is fairly encompassed within the question that we decided to answer.

 

With respect to these theories, the ultimate constitutional question is whether the concepts of “fairness and justice” that underlie the Takings Clause will be better served by one of these categorical rules or by a Penn Central inquiry into all of the relevant circumstances in particular cases. From that perspective, the extreme categorical rule that any deprivation of all economic use, no matter how brief, constitutes a compensable taking surely cannot be sustained. Petitioners’ broad submission would apply to numerous “normal delays in obtaining building permits, changes in zoning ordinances, variances, and the like,” 482 U. S., at 321, as well as to orders temporarily prohibiting access to crime scenes, businesses that violate health codes, fire-damaged buildings, or other areas that we cannot now foresee. Such a rule would undoubtedly require changes in numerous practices that have long been considered permissible exercises of the police power. As Justice Holmes warned in Mahon, “[g]overnment 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.” 260 U. S., at 413. A rule that required compensation for every delay in the use of property would render routine government processes prohibitively expensive or encourage hasty decisionmaking. Such an important change in the law should be the product of legislative rulemaking rather than adjudication.16

 

More importantly, for reasons set out at some length by Justice O’Connor in her concurring opinion in Palazzolo v. Rhode Island, 533 U. S., at 636, we are persuaded that the better approach to claims that a regulation has effected a temporary taking “requires careful examination and weighing of all the relevant circumstances.” In that opinion, Justice O’Connor specifically considered the role that the “temporal relationship between regulatory enactment and title acquisition” should play in the analysis of a takings claim. Id., at 632. We have no occasion to address that particular issue in this case, because it involves a different temporal relationship–the distinction between a temporary restriction and one that is permanent. Her comments on the “fairness and justice” inquiry are, nevertheless, instructive:

 

 

“Today’s holding does not mean that the timing of the regulation’s enactment relative to the acquisition of title is immaterial to the Penn Central analysis. Indeed, it would be just as much error to expunge this consideration from the takings inquiry as it would be to accord it exclusive significance. Our polestar instead remains the principles set forth in Penn Central itself and our other cases that govern partial regulatory takings. Under these cases, interference with investment-backed expectations is one of a number of factors that a court must examine… .

 

 

 

“The Fifth Amendment forbids the taking of private property for public use without just compensation. We have recognized that this constitutional guarantee is ’ “designed to bar Government from forcing some people alone to bear public burdens which, in all fairness and justice, should be borne by the public as a whole.”’ Penn Central, [438 U. S.], at 123-124 (quoting Armstrong v. United States, 364 U. S. 40, 49 (1960)). The concepts of ‘fairness and justice’ that underlie the Takings Clause, of course, are less than fully determinate. Accordingly, we have eschewed ‘any “set formula” for determining when “justice and fairness” require that economic injuries caused by public action be compensated by the government, rather than remain disproportionately concentrated on a few persons.’ Penn Central, supra, at 124 (quoting Goldblatt v. Hempstead, 369 U. S. 590, 594 (1962)). The outcome instead ‘depends largely “upon the particular circumstances [in that] case.”’ Penn Central, supra, at 124 (quoting United States v. Central Eureka Mining Co., 357 U. S. 155, 168 (1958)).” Id., at 633.

 

 

In rejecting petitioners’ per se rule, we do not hold that the temporary nature of a land-use restriction precludes finding that it effects a taking; we simply recognize that it should not be given exclusive significance one way or the other.

 

A narrower rule that excluded the normal delays associated with processing permits, or that covered only delays of more than a year, would certainly have a less severe impact on prevailing practices, but it would still impose serious financial constraints on the planning process.17 Unlike the “extraordinary circumstance” in which the government deprives a property owner of all economic use, Lucas, 505 U. S., at 1017, moratoria like Ordinance 81-5 and Resolution 83– 21 are used widely among land-use planners to preserve the status quo while formulating a more permanent development strategy.18 In fact, the consensus in the planning community appears to be that moratoria, or “interim development controls” as they are often called, are an essential tool of successful development.19 Yet even the weak version of petitioners’ categorical rule would treat these interim measures as takings regardless of the good faith of the planners, the reasonable expectations of the landowners, or the actual impact of the moratorium on property values.20

 

The interest in facilitating informed decisionmaking by regulatory agencies counsels against adopting a per se rule that would impose such severe costs on their deliberations. Otherwise, the financial constraints of compensating property owners during a moratorium may force officials to rush through the planning process or to abandon the practice altogether. To the extent that communities are forced to abandon using moratoria, landowners will have incentives to develop their property quickly before a comprehensive plan can be enacted, thereby fostering inefficient and ill-conceived growth. A finding in the 1980 Compact itself, which presumably was endorsed by all three legislative bodies that participated in its enactment, attests to the importance of that concern. 94 Stat. 3243 (“The legislatures of the States of California and Nevada find that in order to make effective the regional plan as revised by the agency, it is necessary to halt temporarily works of development in the region which might otherwise absorb the entire capability of the region for further development or direct it out of harmony with the ultimate plan”).

 

… .

 

We would create a perverse system of incentives were we to hold that landowners must wait for a takings claim to ripen so that planners can make well-reasoned decisions while, at the same time, holding that those planners must compensate landowners for the delay.

 

Indeed, the interest in protecting the decisional process is even stronger when an agency is developing a regional plan than when it is considering a permit for a single parcel. In the proceedings involving the Lake Tahoe Basin, for example, the moratoria enabled TRPA to obtain the benefit of comments and criticisms from interested parties, such as the petitioners, during its deliberations.21 Since a categorical rule tied to the length of deliberations would likely create added pressure on decisionmakers to reach a quick resolution of land-use questions, it would only serve to disadvantage those landowners and interest groups who are not as organized or familiar with the planning process. Moreover, with a temporary ban on development there is a lesser risk that individual landowners will be “singled out” to bear a special burden that should be shared by the public as a whole. Nollan v. California Coastal Comm’n, 483 U. S. 825, 835 (1987). At least with a moratorium there is a clear “reciprocity of advantage,” Mahon, 260 U. S., at 415, because it protects the interests of all affected landowners against immediate construction that might be inconsistent with the provisions of the plan that is ultimately adopted. “While each of us is burdened somewhat by such restrictions, we, in turn, benefit greatly from the restrictions that are placed on others.” Keystone, 480 U. S., at 491. In fact, there is reason to believe property values often will continue to increase despite a moratorium. See, e. g., Growth Properties, Inc. v. Klingbeil Holding Co., 419 F. Supp. 212, 218 (Md. 1976) (noting that land values could be expected to increase 20% during a 5-year moratorium on development). Cf. Forest Properties, Inc. v. United States, 177 F. 3d 1360, 1367 (CA Fed. 1999) (record showed that market value of the entire parcel increased despite denial of permit to fill and develop lake-bottom property). Such an increase makes sense in this context because property values throughout the Basin can be expected to reflect the added assurance that Lake Tahoe will remain in its pristine state. Since in some cases a 1-year moratorium may not impose a burden at all, we should not adopt a rule that assumes moratoria always force individuals to bear a special burden that should be shared by the public as a whole.

 

It may well be true that any moratorium that lasts for more than one year should be viewed with special skepticism. But given the fact that the District Court found that the 32 months required by TRPA to formulate the 1984 Regional Plan was not unreasonable, we could not possibly conclude that every delay of over one year is constitutionally unacceptable.22 Formulating a general rule of this kind is a suitable task for state legislatures.23 In our view, the duration of the restriction is one of the important factors that a court must consider in the appraisal of a regulatory takings claim, but with respect to that factor as with respect to other factors, the “temptation to adopt what amount to per se rules in either direction must be resisted.” Palazzolo, 533 U. S., at 636 (O’Connor, J., concurring). There may be moratoria that last longer than one year which interfere with reasonable investment-backed expectations, but as the District Court’s opinion illustrates, petitioners’ proposed rule is simply “too blunt an instrument” for identifying those cases. Id., at 628. We conclude, therefore, that the interest in “fairness and justice” will be best served by relying on the familiar Penn Central approach when deciding cases like this, rather than by attempting to craft a new categorical rule.

 

Accordingly, the judgment of the Court of Appeals is affirmed.

 

It is so ordered.

 

 

 

Chief Justice Rehnquist, with whom Justice Scalia and Justice Thomas join, dissenting.

 

 

 

For over half a decade petitioners were prohibited from building homes, or any other structures, on their land. Because the Takings Clause requires the government to pay compensation when it deprives owners of all economically viable use of their land, see Lucas v. South Carolina Coastal Council, 505 U. S. 1003 (1992), and because a ban on all development lasting almost six years does not resemble any traditional land-use planning device, I dissent.

 

 

 

 

I

 

 

 

 

“A court cannot determine whether a regulation has gone ‘too far’ unless it knows how far the regulation goes.” MacDonald, Sommer & Frates v. Yolo County, 477 U. S. 340, 348 (1986) (citing Pennsylvania Coal Co. v. Mahon, 260 U. S. 393, 415 (1922)).24 In failing to undertake this inquiry, the Court ignores much of the impact of respondent’s conduct on petitioners. Instead, it relies on the flawed determination of the Court of Appeals that the relevant time period lasted only from August 1981 until April 1984.

 

… .

 

Because respondent caused petitioners’ inability to use their land from 1981 through 1987, that is the appropriate period of time from which to consider their takings claim.

 

 

 

 

II

 

 

 

 

I now turn to determining whether a ban on all economic development lasting almost six years is a taking. Lucas reaffirmed our “frequently expressed” view that “when the owner of real property has been called upon to sacrifice all economically beneficial uses in the name of the common good, that is, to leave his property economically idle, he has suffered a taking.” 505 U. S., at 1019. See also Agins v. City of Tiburon, 447 U. S. 255, 258-259 (1980). The District Court in this case held that the ordinances and resolutions in effect between August 24, 1981, and April 25, 1984, “did in fact deny the plaintiffs all economically viable use of their land.” 34 F. Supp. 2d 1226, 1245 (Nev. 1999). The Court of Appeals did not overturn this finding. And the 1984 injunction, issued because the environmental thresholds issued by respondent did not permit the development of single-family residences, forced petitioners to leave their land economically idle for at least another three years. The Court does not dispute that petitioners were forced to leave their land economically idle during this period. See ante, at 312. But the Court refuses to apply Lucas on the ground that the deprivation was “temporary.”

 

Neither the Takings Clause nor our case law supports such a distinction. For one thing, a distinction between “temporary” and “permanent” prohibitions is tenuous. The “temporary” prohibition in this case that the Court finds is not a taking lasted almost six years.25 The “permanent” prohibition that the Court held to be a taking in Lucas lasted less than two years. See 505 U. S., at 1011-1012. The “permanent” prohibition in Lucas lasted less than two years because the law, as it often does, changed. The South Carolina Legislature in 1990 decided to amend the 1988 Beach front Management Act to allow the issuance of “‘special permits’ for the construction or reconstruction of habitable structures seaward of the baseline.” Id., at 1011-1012. Landuse regulations are not irrevocable. And the government can even abandon condemned land. See United States v. Dow, 357 U. S. 17, 26 (1958). Under the Court’s decision today, the takings question turns entirely on the initial label given a regulation, a label that is often without much meaning. There is every incentive for government to simply label any prohibition on development “temporary,” or to fix a set number of years. As in this case, this initial designation does not preclude the government from repeatedly extending the “temporary” prohibition into a long-term ban on all development. The Court now holds that such a designation by the government is conclusive even though in fact the moratorium greatly exceeds the time initially specified. Apparently, the Court would not view even a 10-year moratorium as a taking under Lucas because the moratorium is not “permanent.”

 

Our opinion in First English Evangelical Lutheran Church of Glendale v. County of Los Angeles, 482 U. S. 304 (1987), rejects any distinction between temporary and permanent takings when a landowner is deprived of all economically beneficial use of his land. First English stated that “‘temporary takings which, as here, deny a landowner all use of his property, are not different in kind from permanent takings, for which the Constitution clearly requires compensation.” Id., at 318. Because of First English ‘s rule that “temporary deprivations of use are compensable under the Takings Clause,” the Court in Lucas found nothing problematic about the later developments that potentially made the ban on development temporary. 505 U. S., at 1011-1012 (citing First English, supra ); see also 505 U. S., at 1033 (Kennedy, J., concurring in judgment) (“It is well established that temporary takings are as protected by the Constitution as are permanent ones” (citing First English, supra, at 318)).

 

More fundamentally, even if a practical distinction between temporary and permanent deprivations were plausible, to treat the two differently in terms of takings law would be at odds with the justification for the Lucas rule. The Lucas rule is derived from the fact that a “total deprivation of beneficial use is, from the landowner’s point of view, the equivalent of a physical appropriation.” 505 U. S., at 1017. The regulation in Lucas was the “practical equivalence” of a long-term physical appropriation, i. e., a condemnation, so the Fifth Amendment required compensation. The “practical equivalence,” from the landowner’s point of view, of a “temporary” ban on all economic use is a forced leasehold. For example, assume the following situation: Respondent is contemplating the creation of a National Park around Lake Tahoe to preserve its scenic beauty. Respondent decides to take a 6-year leasehold over petitioners’ property, during which any human activity on the land would be prohibited, in order to prevent any further destruction to the area while it was deciding whether to request that the area be designated a National Park.

 

Surely that leasehold would require compensation. In a series of World War II-era cases in which the Government had condemned leasehold interests in order to support the war effort, the Government conceded that it was required to pay compensation for the leasehold interest.26 See United States v. Petty Motor Co., 327 U. S. 372 (1946); United States v. General Motors Corp., 323 U. S. 373, 376 (1945). From petitioners’ standpoint, what happened in this case is no different than if the government had taken a 6-year lease of their property. The Court ignores this “practical equivalence” between respondent’s deprivation and the deprivation resulting from a leasehold. In so doing, the Court allows the government to “do by regulation what it cannot do through eminent domain–i. e., take private property without paying for it.” 228 F. 3d 998, 999 (CA9 2000) (Kozinski, J., dissenting from denial of rehearing en banc).

 

Instead of acknowledging the “practical equivalence” of this case and a condemned leasehold, the Court analogizes to other areas of takings law in which we have distinguished between regulations and physical appropriations, see ante, at 321-324. But whatever basis there is for such distinctions in those contexts does not apply when a regulation deprives a landowner of all economically beneficial use of his land. In addition to the “practical equivalence” from the landowner’s perspective of such a regulation and a physical appropriation, we have held that a regulation denying all productive use of land does not implicate the traditional justification for differentiating between regulations and physical appropriations. In “the extraordinary circumstance when no productive or economically beneficial use of land is permitted,” it is less likely that “the legislature is simply ‘adjusting the benefits and burdens of economic life’ … in a manner that secures an ‘average reciprocity of advantage’ to everyone concerned,” Lucas, supra, at 1017-1018 (quoting Penn Central Transp. Co. v. New York City, 438 U. S., at 124, and Pennsylvania Coal Co. v. Mahon, 260 U. S., at 415), and more likely that the property “is being pressed into some form of public service under the guise of mitigating serious public harm,” Lucas, supra, at 1018.

 

The Court also reads Lucas as being fundamentally concerned with value, ante, at 329-331, rather than with the denial of “all economically beneficial or productive use of land,” 505 U. S., at 1015. But Lucas repeatedly discusses its holding as applying where ”no productive or economically beneficial use of land is permitted.” Id., at 1017; see also ibid. (“[T]otal deprivation of beneficial use is, from the landowner’s point of view, the equivalent of a physical appropriation”); id., at 1016 (“[T]he Fifth Amendment is violated when land-use regulation … denies an owner economically viable use of his land”); id., at 1018 (“[T]he functional basis for permitting the government, by regulation, to affect property values without compensation … does not apply to the relatively rare situations where the government has deprived a landowner of all economically beneficial uses”); ibid. (“[T]he fact that regulations that leave the owner of land without economically beneficial or productive options for its use … carry with them a heightened risk that private property is being pressed into some form of public service”); id., at 1019 (“[W]hen the owner of real property has been called upon to sacrifice all economically beneficial uses in the name of the common good, that is, to leave his property economically idle, he has suffered a taking”). Moreover, the Court’s position that value is the sine qua non of the Lucas rule proves too much. Surely, the land at issue in Lucas retained some market value based on the contingency, which soon came to fruition (see supra, at 347), that the development ban would be amended.

 

Lucas is implicated when the government deprives a landowner of “all economically beneficial or productive use of land.” 505 U. S., at 1015. The District Court found, and the Court agrees, that the moratorium “temporarily” deprived petitioners of “‘all economically viable use of their land.’ ” Ante, at 316. Because the rationale for the Lucas rule applies just as strongly in this case, the “temporary” denial of all viable use of land for six years is a taking.

 

 

 

 

III

 

 

 

 

The Court worries that applying Lucas here compels finding that an array of traditional, short-term, land-use planning devices are takings. Ante, at 334-335, 337-338. But since the beginning of our regulatory takings jurisprudence, we have recognized that property rights “are enjoyed under an implied limitation.” Mahon, supra, at 413.

 

… .

 

But a moratorium prohibiting all economic use for a period of six years is not one of the longstanding, implied limitations of state property law.27 Moratoria are “interim controls on the use of land that seek to maintain the status quo with respect to land development in an area by either ‘freezing’ existing land uses or by allowing the issuance of building permits for only certain land uses that would not be inconsistent with a contemplated zoning plan or zoning change.” 1 E. Ziegler, Rathkopf’s The Law of Zoning and Planning § 13:3, p. 13-6 (4th ed. 2001). Typical moratoria thus prohibit only certain categories of development, such as fast-food restaurants, see Schafer v. New Orleans, 743 F. 2d 1086 (CA5 1984), or adult businesses, see Renton v. Playtime Theatres, Inc., 475 U. S. 41 (1986), or all commercial development, see Arnold Bernhard & Co. v. Planning & Zoning Comm’n, 194 Conn. 152, 479 A. 2d 801 (1984). Such moratoria do not implicate Lucas because they do not deprive landowners of all economically beneficial use of their land. As for moratoria that prohibit all development, these do not have the lineage of permit and zoning requirements and thus it is less certain that property is acquired under the “implied limitation” of a moratorium prohibiting all development. Moreover, unlike a permit system in which it is expected that a project will be approved so long as certain conditions are satisfied, a moratorium that prohibits all uses is by definition contemplating a new land-use plan that would prohibit all uses.

 

But this case does not require us to decide as a categorical matter whether moratoria prohibiting all economic use are an implied limitation of state property law, because the duration of this “moratorium” far exceeds that of ordinary moratoria. As the Court recognizes, ante, at 342, n. 37, state statutes authorizing the issuance of moratoria often limit the moratoria’s duration. California, where much of the land at issue in this case is located, provides that a moratorium “shall be of no further force and effect 45 days from its date of adoption,” and caps extension of the moratorium so that the total duration cannot exceed two years. Cal. Govt. Code Ann. § 65858(a) (West Supp. 2002); see also Minn. Stat. § 462.355, subd. 4 (2000) (limiting moratoria to 18 months, with one permissible extension, for a total of two years). Another State limits moratoria to 120 days, with the possibility of a single 6-month extension. Ore. Rev. Stat. Ann. § 197.520(4) (1997). Others limit moratoria to six months without any possibility of an extension. See Colo. Rev. Stat. § 30-28-121 (2001); N. J. Stat. Ann. § 40:55D-90(b) (1991).28 Indeed, it has long been understood that moratoria on development exceeding these short time periods are not a legitimate planning device. See, e. g., Holdsworth v. Hague, 9 N. J. Misc. 715, 155 A. 892 (1931).

 

Resolution 83-21 reflected this understanding of the limited duration of moratoria in initially limiting the moratorium in this case to 90 days. But what resulted–a “moratorium” lasting nearly six years–bears no resemblance to the short-term nature of traditional moratoria as understood from these background examples of state property law.

 

Because the prohibition on development of nearly six years in this case cannot be said to resemble any “implied limitation” of state property law, it is a taking that requires compensation.

 

 

 

 

* * *

 

 

 

 

Lake Tahoe is a national treasure, and I do not doubt that respondent’s efforts at preventing further degradation of the lake were made in good faith in furtherance of the public interest. But, as is the case with most governmental action that furthers the public interest, the Constitution requires that the costs and burdens be borne by the public at large, not by a few targeted citizens. Justice Holmes’ admonition of 80 years ago again rings true: “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.” Mahon, 260 U. S., at 416.

 


    1. Often referred to as the “Just Compensation Clause,” the final Clause of the Fifth Amendment provides: ”… nor shall private property be taken for public use without just compensation.” It applies to the States as well as the Federal Government. Chicago, B. & Q. R. Co. v. Chicago, 166 U. S. 226, 239, 241 (1897); Webb’s Fabulous Pharmacies, Inc. v. Beckwith, 449 U. S. 155, 160 (1980).

 

    1. According to a Senate Report: “Only two other sizable lakes in the world are of comparable quality–Crater Lake in Oregon, which is protected as part of the Crater Lake National Park, and Lake Baikal in the [former] Soviet Union. Only Lake Tahoe, however, is so readily accessible from large metropolitan centers and is so adaptable to urban development.” S. Rep. No. 91-510, pp. 3-4 (1969).

 

    1. In determining whether government action affecting property is an unconstitutional deprivation of ownership rights under the Just Compensation Clause, a court must interpret the word “taken.” When the government condemns or physically appropriates the property, the fact of a taking is typically obvious and undisputed. When, however, the owner contends a taking has occurred because a law or regulation imposes restrictions so severe that they are tantamount to a condemnation or appropriation, the predicate of a taking is not self-evident, and the analysis is more complex.

 

    1. To illustrate the importance of the distinction, the Court in Loretto, 458 U. S., at 430, compared two wartime takings cases, United States v. Pewee Coal Co., 341 U. S. 114, 116 (1951), in which there had been an “actual taking of possession and control” of a coal mine, and United States v. Central Eureka Mining Co., 357 U. S. 155 (1958), in which, “by contrast, the Court found no taking where the Government had issued a wartime order requiring nonessential gold mines to cease operations . .. .” 458 U. S., at 431. Loretto then relied on this distinction in dismissing the argument that our discussion of the physical taking at issue in the case would affect landlord-tenant laws. “So long as these regulations do not require the landlord to suffer the physical occupation of a portion of his building by a third party, they will be analyzed under the multifactor inquiry generally applicable to nonpossessory governmental activity.” Id., at 440 (citing Penn Central ).

 

    1. According to The Chief Justice’s dissent, even a temporary, useprohibiting regulation should be governed by our physical takings cases because, under Lucas v. South Carolina Coastal Council, 505 U. S. 1003, 1017 (1992), “from the landowner’s point of view,” the moratorium is the functional equivalent of a forced leasehold, post, at 348. Of course, from both the landowner’s and the government’s standpoint there are critical differences between a leasehold and a moratorium. Condemnation of a leasehold gives the government possession of the property, the right to admit and exclude others, and the right to use it for a public purpose. A regulatory taking, by contrast, does not give the government any right to use the property, nor does it dispossess the owner or affect her right to exclude others.

       

      The Chief Justice stretches Lucas ’ “equivalence” language too far. For even a regulation that constitutes only a minor infringement on property may, from the landowner’s perspective, be the functional equivalent of an appropriation. Lucas carved out a narrow exception to the rules governing regulatory takings for the “extraordinary circumstance” of a permanent deprivation of all beneficial use. The exception was only partially justified based on the “equivalence” theory cited by The Chief Justice’s dissent. It was also justified on the theory that, in the “relatively rare situations where the government has deprived a landowner of all economically beneficial uses,” it is less realistic to assume that the regulation will secure an “average reciprocity of advantage,” or that government could not go on if required to pay for every such restriction. 505 U. S., at 1017-1018. But as we explain, infra, at 339-341, these assumptions hold true in the context of a moratorium.

 

    1. The case involved “a bill in equity brought by the defendants in error to prevent the Pennsylvania Coal Company from mining under their property in such way as to remove the supports and cause a subsidence of the surface and of their house.” Mahon, 260 U. S., at 412. Mahon sought to prevent Pennsylvania Coal from mining under his property by relying on a state statute, which prohibited any mining that could undermine the foundation of a home. The company challenged the statute as a taking of its interest in the coal without compensation.

 

    1. In Lucas, we explained: “Prior to Justice Holmes’s exposition in Pennsylvania Coal Co. v. Mahon, 260 U. S. 393 (1922), it was generally thought that the Takings Clause reached only a ‘direct appropriation’ of property, Legal Tender Cases, 12 Wall. 457, 551 (1871), or the functional equivalent of a ‘practical ouster of [the owner’s] possession,’ Transportation Co. v. Chicago, 99 U. S. 635, 642 (1879) … . Justice Holmes recognized in Mahon, however, that if the protection against physical appropriations of private property was to be meaningfully enforced, the government’s power to redefine the range of interests included in the ownership of property was necessarily constrained by constitutional limits. 260 U. S., at 414-415. If, instead, the uses of private property were subject to unbridled, uncompensated qualification under the police power, ‘the natural tendency of human nature [would be] to extend the qualification more and more until at last private property disappear[ed].’ Id., at 415. These considerations gave birth in that case to the oft-cited maxim that, ‘while property may be regulated to a certain extent, if regulation goes too far it will be recognized as a taking.’ Ibid. ” 505 U. S., at 1014 (citation omitted).

 

    1. Justice Brandeis argued: “Every restriction upon the use of property imposed in the exercise of the police power deprives the owner of some right theretofore enjoyed, and is, in that sense, an abridgment by the State of rights in property without making compensation. But restriction imposed to protect the public health, safety or morals from dangers threatened is not a taking. The restriction here in question is merely the prohibition of a noxious use. The property so restricted remains in the possession of its owner. The State does not appropriate it or make any use of it. The State merely prevents the owner from making a use which interferes with paramount rights of the public.” Mahon, 260 U. S., at 417 (dissenting opinion).

 

    1. In her concurring opinion in Palazzolo, 533 U. S., at 633, Justice O’Connor reaffirmed this approach: “Our polestar instead remains the principles set forth in Penn Central itself and our other cases that govern partial regulatory takings. Under these cases, interference with investment-backed expectations is one of a number of factors that a court must examine.” Ibid. “Penn Central does not supply mathematically precise variables, but instead provides important guide posts that lead to the ultimate determination whether just compensation is required.” Id., at 634. “The temptation to adopt what amount to per se rules in either direction must be resisted. The Takings Clause requires careful examination and weighing of all the relevant circumstances in this context.” Id., at 636.

 

    1. Justice Kennedy concurred in the judgment on the basis of the regulation’s impact on “reasonable, investment-backed expectations.” 505 U. S., at 1034.

 

    1. It is worth noting that Lucas underscores the difference between physical and regulatory takings. See supra, at 322-325. For under our physical takings cases it would be irrelevant whether a property owner maintained 5% of the value of her property so long as there was a physical appropriation of any of the parcel.

 

    1. The Chief Justice’s dissent makes the same mistake by carving out a 6-year interest in the property, rather than considering the parcel as a whole, and treating the regulations covering that segment as analogous to a total taking under Lucas, post, at 351.

 

    1. Armstrong, like Lucas, was a case that involved the “total destruction by the Government of all value” in a specific property interest. 364 U. S., at 48-49. It is nevertheless perfectly clear that Justice Black’s oft-quoted comment about the underlying purpose of the guarantee that private property shall not be taken for a public use without just compensation applies to partial takings as well as total takings.

 

    1. Brief for the Institute for Justice as Amicus Curiae 30. Although amicus describes the 1-year cutoff proposal as the “better approach by far,”ibid., its primary argument is that Penn Central should be overruled, id., at 20 (”All partial takings by way of land use restriction should be subject to the same prima facie rules for compensation as a physical occupation for a limited period of time”).

 

    1. Brief for Petitioners 44.See also Pet. for Cert. i.

 

    1. In addition, we recognize the anomaly that would be created if we were to apply Penn Central when a landowner is permanently deprived of 95% of the use of her property, Lucas, 505 U. S.,at 1019, n. 8,and yet find a per se taking anytime the same property owner is deprived of all use for only five days. Such a scheme would present an odd inversion of Justice Holmes’ adage: “A limit in time, to tide over a passing trouble, well may justify a law that could not be upheld as a permanent change.” Block v. Hirsh, 256 U. S. 135, 157 (1921).

 

    1. Petitioners fail to offer a persuasive explanation for why moratoria should be treated differently from ordinary permit delays. They contend that a permit applicant need only comply with certain specific requirements in order to receive one and can expect to develop at the end of the process, whereas there is nothing the landowner subject to a moratorium can do but wait, with no guarantee that a permit will be granted at the end of the process. Brief for Petitioners 28. Setting aside the obvious problem with basing the distinction on a course of events we can only know after the fact–in the context of a facial challenge–petitioners’ argument breaks down under closer examination because there is no guarantee that a permit will be granted, or that a decision will be made within a year. See, e. g., Dufau v. United States, 22 Cl. Ct. 156 (1990) (holding that 16-month delay in granting a permit did not constitute a temporary taking). Moreover, under petitioners’ modified categorical rule, there would be no per se taking if TRPA simply delayed action on all permits pending a regional plan. Fairness and justice do not require that TRPA be penalized for achieving the same result, but with full disclosure.

 

    1. See, e. g., Santa Fe Village Venture v. Albuquerque, 914 F. Supp. 478, 483 (N. M. 1995) (30-month moratorium on development of lands within the Petroglyph National Monument was not a taking); Williams v. Central, 907 P. 2d 701, 703-706 (Colo. App. 1995) (10-month moratorium on development in gaming district while studying city’s ability to absorb growth was not a compensable taking); Woodbury Place Partners v. Woodbury, 492 N. W. 2d 258 (Minn. App. 1993)(moratorium pending review of plan for land adjacent to interstate highway was not a taking even though it deprived property owner of all economically viable use of its property for two years); Zilber v. Moranga, 692 F. Supp. 1195 (ND Cal. 1988) (18-month development moratorium during completion of a comprehensive scheme for open space did not require compensation). See also Wayman, Leaders Consider Options for Town Growth, Charlotte Observer, Feb. 3, 2002, p. 15M (describing 10-month building moratorium imposed “to give town leaders time to plan for development”); Wallman, City May Put Reins on Beach Projects, Sun-Sentinel, May 16, 2000, p. 1B (2-year building moratorium on beach front property in Fort Lauderdale pending new height, width, and dispersal regulations); Foderaro, In Suburbs, They’re Cracking Down on the Joneses, N. Y. Times, Mar. 19, 2001, p. A1 (describing moratorium imposed in Eastchester, New York, during a review of the town’s zoning code to address the problem of oversized homes); Dawson, Commissioners recommend Aboite construction ban be lifted, Fort Wayne News Sentinel, May 4, 2001, p. 1A (3-year moratorium to allow improvements in the water and sewage treatment systems).

 

    1. See J. Juergensmeyer & T. Roberts, Land Use Planning and Control Law §§ 5.28(G) and 9.6 (1998); Garvin & Leitner, Drafting Interim Development Ordinances: Creating Time to Plan, 48 Land Use Law & Zoning Digest 3 (June 1996) (“With the planning so protected, there is no need for hasty adoption of permanent controls in order to avoid the establishment of nonconforming uses, or to respond in an ad hoc fashion to specific problems. Instead, the planning and implementation process may be permitted to run its full and natural course with widespread citizen input and involvement, public debate, and full consideration of all issues and points of view”); Freilich, Interim Development Controls: Essential Tools for Implementing Flexible Planning and Zoning, 49 J. Urb. L. 65 (1971).

 

    1. The Chief Justice offers another alternative, suggesting that delays of six years or more should be treated as per se takings. However, his dissent offers no explanation for why 6 years should be the cutoff point rather than 10 days, 10 months, or 10 years. It is worth emphasizing that we do not reject a categorical rule in this case because a 32-month moratorium is just not that harsh. Instead, we reject a categorical rule because we conclude that the Penn Central framework adequately directs the inquiry to the proper considerations–only one of which is the length of the delay.

 

    1. Petitioner Preservation Council, “through its authorized representatives, actively participated in the entire TRPA regional planning process leading to the adoption of the 1984 Regional Plan at issue in this action, and attended and expressed its views and concerns, orally and in writing, at each public hearing held by the Defendant TRPA in connection with the consideration of the 1984 Regional Plan at issue herein, as well as in connection with the adoption of Ordinance 81-5 and the Revised 1987 Regional Plan addressed herein.” App. 24.

 

    1. We note that the temporary restriction that was ultimately upheld in the First English case lasted for more than six years before it was replaced by a permanent regulation. em>First English Evangelical Lutheran Church of Glendale v. County of Los Angeles, 210 Cal. App. 3d 1353, 258 Cal. Rptr. 893 (1989).

 

    1. Several States already have statutes authorizing interim zoning ordinances with specific time limits. See Cal. Govt. Code Ann. § 65858 (West Supp. 2002) (authorizing interim ordinance of up to two years); Colo. Rev. Stat. § 30-28-121 (2001) (six months); Ky. Rev. Stat. Ann. § 100.201 (2001) (one year); Mich. Comp. Laws Ann. § 125.215 (West 2001) (three years); Minn. Stat. § 394.34 (2000) (two years); N. H. Rev. Stat. Ann. § 674:23 (West 2001) (one year); Ore. Rev. Stat. Ann. § 197.520 (1997) (10 months); S. D. Codified Laws § 11-2–10 (2001) (two years); Utah Code Ann. § 17-27-404 (1995) (18 months); Wash. Rev. Code § 35.63.200 (2001); Wis. Stat. § 62.23(7)(d) (2001) (two years). Other States, although without specific statutory authority, have recognized that reasonable interim zoning ordinances may be enacted. See, e. g., S. E. W. Freil v. Triangle Oil Co., 76 Md. App. 96, 543 A. 2d 863 (1988); New Jersey Shore Builders Assn. v. Dover Twp. Comm., 191 N. J. Super. 627, 468 A. 2d 742 (1983); SCA Chemical Waste Servs., Inc. v. Konigsberg, 636 S. W. 2d 430 (Tenn. 1982); Sturgess v. Chilmark, 380 Mass. 246, 402 N. E. 2d 1346 (1980); Lebanon v. Woods, 153 Conn. 182, 215 A. 2d 112 (1965).

 

    1. We are not bound by the Court of Appeals’ determination that petitioners’ claim under 42 U. S. C. § 1983 (1994 ed., Supp. V) permitted only challenges to Ordinance 81-5 and Regulation 83-21. Petitioners sought certiorari on the Court of Appeals’ ruling that respondent Tahoe Regional Planning Agency (hereinafter respondent) did not cause petitioners’ injury from 1984 to 1987. Pet. for Cert. 27-30. We did not grant certiorari on any of the petition’s specific questions presented, but formulated the following question: “Whether the Court of Appeals properly determined that a temporary moratorium on land development does not constitute a taking of property requiring compensation under the Takings Clause of the United States Constitution?” 533 U. S. 948-949 (2001). This Court’s Rule 14(1)(a) provides that a “question presented is deemed to comprise every subsidiary question fairly included therein.” The question of how long the moratorium on land development lasted is necessarily subsumed within the question whether the moratorium constituted a taking. Petitioners did not assume otherwise. Their brief on the merits argues that respondent “effectively blocked all construction for the past two decades.” Brief for Petitioners 7.

 

    1. Even under the Court’s mistaken view that the ban on development lasted only 32 months, the ban in this case exceeded the ban in Lucas.

 

    1. There was no dispute that just compensation was required in those cases. The disagreement involved how to calculate that compensation. In United States v. General Motors Corp., 323 U. S. 373 (1945), for example, the issues before the Court were how to value the leasehold interest (i. e., whether the “long-term rental value [should be] the sole measure of the value of such short-term occupancy,” id., at 380), whether the Government had to pay for the respondent’s removal of personal property from the condemned warehouse, and whether the Government had to pay for the reduction in value of the respondent’s equipment and fixtures left in the warehouse. Id., at 380-381.

 

    1. Six years is not a “cutoff point,” ante, at 338, n. 34; it is the length involved in this case. And the “explanation” for the conclusion that there is a taking in this case is the fact that a 6-year moratorium far exceeds any moratorium authorized under background principles of state property law. See infra, at 353-354. This case does not require us to undertake a more exacting study of state property law and discern exactly how long a moratorium must last before it no longer can be considered an implied limitation of property ownership (assuming, that is, that a moratorium on all development is a background principle of state property law, see infra, at 353).

 

    1. These are just some examples of the state laws limiting the duration of moratoria. There are others. See, e. g., Utah Code Ann. §§ 17-27– 404(3)(b)(i)–(ii) (1995) (temporary prohibitions on development “may not exceed six months in duration,” with the possibility of extensions for no more than “two additional six-month periods”). See also ante, at 337, n. 31.

 

 

 

PROBLEMS

 

 

 

    1. Why does Lucas not determine the result in TRPA?

       

 

    1. Was there a taking in TRPA? Does the Court determine this? What do you think the answer is and how would you analyze the question?

       

 

Economic Analysis of “Takings” of Private Property, available at http://cyber.law.harvard.edu/bridge/LawEconomics/takings.htm

 

 

 

A crucial constitutional question since the founding of the United States has been the extent to which the state and federal legislatures are permitted to impair private property rights. From the beginning, American courts have recognized that governments must be accorded some latitude in setting and modifying the entitlements associated with the ownership of land and other commodities. The courts have refused, however, to acquiesce in all legislative interferences with private property rights.

 

The constitutional provisions used to shield property from governmental encroachment have changed over the course of American history. Until the end of the nineteenth century, most regulations of private property emanated from the state governments, not the federal government. That fact – combined with the Supreme Court’s ruling that the Bill of Rights was inapplicable to the states – minimized the significance of the Fifth Amendment’s ban on uncompensated “takings” of private property. In the limited number of cases in which the Supreme Court undertook to review challenges to allegedly confiscatory legislation, it based its rulings either on broad principles of natural law or on the contracts clause of Article I, Section 10. In 1897, the Supreme Court held for the first time that the due-process clause of the Fourteenth Amendment “incorporated” against the states the takings clause of the Fifth Amendment. Since that date the stream of cases invoking the federal Constitution to challenge legislative or judicial impairments of property rights has steadily increased.

 

Before World War II, legal scholars paid relatively little attention to the so-called “takings” doctrine. Since the 1950s, however, the body of academic writing dealing with the issue has mushroomed. The ambition of the large majority of the authors who have contributed to the discussion has been to define a principled line that would enable the courts to differentiate permissible “regulation” of private property from impermissible (if uncompensated) expropriation thereof. Prominent among those who have attempted this feat have been economists.

 

Economic analysis of the takings doctrine can be traced to a 1967 Harvard Law Review article in which Frank Michelman argued (among other things) that a judge called on to determine whether the Fifth Amendment had been violated in a particular case might plausibly select as her criterion of judgment the maximization of net social welfare. If that were her ambition, Michelman contended, the judge should begin by estimating and comparing the following economic impacts:

 

    1. the net efficiency gains secured by the government action in question (in other words, “the excess of benefits produced by the measure over losses inflicted by it”);

 

    1. the “settlement costs” – i.e., the costs of measuring the injuries sustained by adversely affected parties and of providing them monetary compensation; and

 

    1. the “demoralization costs” incurred by not indemnifying them. Michelman’s definition of the third of these terms was original and critical; to ascertain the “demoralization costs” entailed by not paying compensation, the judge should measure “the total of … the dollar value necessary to offset disutilities which accrue to losers and their sympathizers specifically from the realization that no compensation is offered, and … the present capitalized dollar value of lost future production (reflecting either impaired incentives or social unrest) caused by demoralization of uncompensated losers, their sympathizers, and other observers disturbed by the thought that they themselves may be subjected to similar treatment on some other occasion.”

 

Once the judge has calculated these impacts, Michelman contended, her job is straightforward.

 

    • If (1) is the smallest figure, she should contrive some way to enjoin the action – for example, by declaring it to be violative of the constitutional requirement that private property be taken only for a “public use.”

 

    • If (2) is the smallest figure, she should not enjoin the action but should require that the parties hurt by it be compensated.

 

    • If (3) is the smallest figure, she should allow the government to proceed without indemnifying the victims.

 

Applying this composite test, Michelman suggested that some of the guidelines employed by the Supreme Court when deciding takings cases, though seemingly simplistic or senseless, turn out to have plausible utilitarian justifications. For example, the rule that “physical invasion” by government of private property is always deemed a taking, though apparently a clumsy device for separating mild from severe encroachments on private rights, turns out to have important redeeming features: it identifies a set of cases in which settlement costs (the costs of both ascertaining liability and measuring the resultant damages) are likely to be modest and in which, because of the “psychological shock, the emotional protest, the symbolic threat to all property and security” commonly associated with bald invasions, “demoralization costs” are likely to be high – precisely the circumstance in which compensation is most appropriate. Similarly, the courts’ sensitivity in takings cases to the ratio between the economic injury sustained by the plaintiff and the overall value of the affected parcel (rather than to the absolute amount of the economic injury) makes some sense on the following plausible assumptions: “(1) that one thinks of himself not just as owning a total amount of wealth or income, but also as owning several discrete things whose destinies he controls; (2) that deprivation of one of these mentally circumscribed things is an event attended by pain of a specially acute or demoralizing kind, as compared with what one experiences in response to the different kind of event consisting of a general decline in one’s net worth; and (3) that events of the specially painful kind can usually be identified by compensation tribunals with relative ease.”

 

Michelman’s analysis proved highly influential among constitutional scholars, but did not go uncontested. In the 1980s, several younger scholars argued that Michelman had made a crucial mistake. When measuring “demoralization costs,” they argued, a judge should not include the diminution in investment and “productive activity” caused by not making the victims whole. Indeed, widespread adoption of Michelman’s strategy would send precisely the wrong signal to property owners; assured that they would be indemnified if and when the public needed their land, they would overinvest in capital improvements – and, in particular, in capital improvements likely soon to be rendered obsolete by governmental action or regulation. Inducement of efficient kinds and levels of activity, the revisionist economists claimed, requires that economic actors “bear all real costs and benefits of their decisions” including the risk of future changes in pertinent legal rules.

 

From this point (now widely considered convincing), economic analysis of the takings doctrine has radiated in a variety of directions. Here are a few:

 

 

 

Insurance Schemes. The guideline just mentioned (that efficiency will be enhanced by forcing landowners to bear the risk of future changes in pertinent legal rules) has at least one serious drawback: It may result in a few landowners suffering very large, uncompensated losses – a situation economists generally regard as undesirable. From an efficiency standpoint, the best solution to this problem would be the development and widespread use of a private insurance system. Landowners would buy “takings” insurance, just as they now routinely buy fire insurance. Such a system would not erode the benefits of making landowners bear the costs of regulation, because the rate that an insurer charged for insuring a particular parcel would almost certainly reflect the likelihood that that particular parcel would later be subject to governmental action. For example, developers who bought land in flood plains or on eroding beaches would pay very large premiums, while landowners in lower-risk areas would pay much lower premiums. The resultant incentive to avoid developing parcels likely soon to be regulated is precisely what we would wish to create.

 

Unfortunately, a private market in “takings” insurance has not yet developed. Various reasons have been suggested for this failure, but the fact remains that landowners cannot currently shield themselves against uncompensated takings. Even if private insurance were available, some landowners undoubtedly would not purchase it – because they systematically underestimated the danger of regulation or because they were simply poor planners. Under these nonideal conditions, some economists have conceded that governmental compensation for severe land-use regulations may be economically defensible as, in effect, a form of compulsory state-supplied insurance.

 

 

 

Reconstructing Demoralization Costs. Perhaps the revisionist critique of “demoralization costs” has gone too far. After all, many people become unhappy when they experience or witness uncompensated severe regulations of private property, and those psychic injuries (measured, as always, by people’s willingness and ability to pay money to avoid them) must be considered when one tries to design a takings doctrine that maximizes net social welfare. Moreover, those costs go further than the (potentially substantial) disutilities caused by the frustration of people’s “political preferences” – the pain they experience when they witness behavior they consider unjust. They include secondary effects that might be called “search costs”:

 

 

A judicial decision denying compensation in defiance of a popular perception that it should be forthcoming risks undermining people’s faith that, by the large, the law comports with their sense of justice. Erosion of that faith, in turn, would reduce people’s willingness to make decisions – the rationality of which depends upon the content of the pertinent legal rules – without taking the time to “look up” the rules… . Generally speaking, our willingness to act in this fashion is efficient; as long as the rules are in fact consistent with our senses of justice, it is desirable, from an economic standpoint, that we trust our intuitions. Any material diminution in that willingness would give rise to deadweight losses that merit the attention of a conscientious economist.

 

 

Determining the magnitude of demoralization costs of these various sorts is, however, very difficult. Frequently, one can argue plausibly that the psychic injuries caused by a particular sort of regulation will be huge – or will be insignificant. Consider, for example, the situation in which land-use regulations are suddenly tightened, not by the legislature, but by a change in common-law rules. Will the demoralization costs caused by such putative “judicial takings” be smaller or larger than those associated with comparable “legislative takings”? Barton Thompson points to several circumstances suggesting that they will be smaller: the fact that courts can more easily disguise the extent to which they are changing the pertinent land-use regulations; courts’ ability to fall back on their general reputation for objective and principled decisionmaking; and the tendency of the doctrine of stare decisis to mitigate landowners’ anxieties that judicial modification of one land-use regulation portends more sweeping changes in the future. Barton acknowledges, however, that many of these factors can be “flipped,” suggesting that judicial takings will result in unusually high demoralization costs:

 

 

The mysteries and insulation of the judicial process, for example, might actually increase demoralization. Property holders may believe that they at least understand the legislative process, have some electoral control over politicians, and know how to wage a fight on political grounds. They may feel far more distressed about a legal process that affects them without apparently understanding their concerns, speaks in a foreign and confusing tongue, and is directed by judges over whom they feel they have no effective popular control. Given the existence of stare decisis and people’s expectations that courts will generally observe precedent, moreover, property holders may fear disintegration of the social structure far more when a court significantly modifies prior property law than when the legislature engages in traditional political behavior.

 

 

Barton’s avowedly indeterminate analysis of “judicial takings” is typical of the murk one enters when trying to predict psychic injuries. In short, demoralization costs are plainly relevant to the design of an efficient takings doctrine, but their uncertainty makes economists queasy about relying on them.

 

 

 

“Fiscal Illusions.” Several economists have argued that it is mistaken to concentrate exclusively upon the effect of constitutional doctrine on the incentives of landowners to use and improve their possessions; one must also take into account the incentives of government officials to regulate private property. Specifically, these economists have argued that, unless government officials are compelled somehow to bear the costs of the regulations they adopt, they will tend to impose on private property inefficiently tight land-use controls. In this respect, the position of the government vis-à-vis private landowners is similar to the position of a private landowner vis-à-vis her neighbors. The purpose of nuisance law, it is often said, is to force each landowner to internalize the costs of her activities and thus discourage her from acting in ways that impose on her neighbors inefficiently high levels of annoyance (smoke, smells, pollution, excess light, etc.). Similarly, some economists have argued, the purpose of a just-compensation requirement is to compel government officials to internalize the costs of their regulatory activities and thus discourage them from fettering landowners excessively. This claim has been subjected by other economists to two sorts of critique. First, it is not altogether clear that, unless deterred by a just-compensation requirement, government officials will overregulate. Louis Kaplow points out that, although it is true that (in the absence of such a requirement) government officials will not bear the costs of their regulatory activities, they also will not reap the benefits of those activities. (In this respect, they are different from potentially hyperactive private landowners.) There is thus no reason to assume that, unless leashed by a strict takings doctrine, officials will run amok. A student Note in the Harvard Law Review reinforces this point by suggesting two reasons why government officials might be prone to adopt inefficiently low levels of regulation: (a) ordinarily, the beneficiaries of land-use restrictions are more dispersed (and thus less able to make their views known to their elected representatives) than the landowners adversely affected by those regulations; and (b) government officials typically undervalue the interests in regulation of the members of future generations.

 

Second, even if the “fiscal-illusion” effect is serious, it is not obvious that the enforcement of a constitutional just-compensation requirement is the only – or best – way to offset it. Other strategies might work as well or better. For example, the student Note just mentioned contends that optimal levels of regulation might be achieved equally effectively by assigning to the state the authority to proscribe without compensation any uses of private land that government officials believe are injurious to the public – but then permit adversely affected landowners to buy from the government exemptions from those regulations. The state’s police power, in other words, could be treated as an alienable servitude. Unless transaction costs interfered with the market in such exemptions (concededly a tricky issue), the adoption of such a system should (Coase tells us) result in the same, efficient level of regulation as a regime in which landowners were originally assigned the right not to be regulated and the state had to expropriate (through the payment of “just compensation”) the authority to regulate them.

 

Has this growing body of scholarship had any impact on the courts? Yes and no. Some of the economists’ more basic arguments have indeed influenced judicial resolution of takings cases. For example, the causal nihilism typical of most economic analyses contributed to the partial corrosion of the so-called noxious-use exception to the ban on uncompensated takings. In the early twentieth century the Supreme Court consistently and confidently ruled that when a state forbids the continuation of a use of land or other property that would be harmful to the public or to neighbors, it is not obliged to indemnify the owner. For example, in Miller v. Schoene, the Court upheld on this basis a Virginia statute that required the owner of ornamental cedar trees to cut them down because they produced cedar rust that endangered apple trees in the vicinity. As legal scholars became increasingly familiar with the economic analysis of doctrinal problems – and, in particular, with Ronald Coase’s assertion that, in all cases of conflicting land uses, it is senseless to characterize one such use as the “cause” of harm to the other – they pointed out that the Court’s handling of cases like Miller was naive. The activity of keeping cedar trees in the vicinity of apple orchards is no more (and no less) “noxious” than the activity of keeping apple orchards in the vicinity of cedar trees. In the face of this chorus of criticism, the Court retreated. Its renunciation of the “noxious use” test was most complete and overt in Justice Brennan’s majority opinion in the case with which we have been concerned:

 

 

We observe that the land uses in issue in Hadacheck, Miller, and Goldblatt were perfectly lawful in themselves. They involved no “blameworthiness, … moral wrongdoing or conscious act of dangerous risk-taking which induced society to shift the cost to a particular individual.” These cases are better understood as resting not on any supposed “noxious” quality of the prohibited uses but rather on the ground that the restrictions were reasonably related to the implementation of a policy – not unlike historic preservation – expected to produce a widespread public benefit and applicable to all similarly situated property.

 

 

For better or worse, however, the Court since Penn Central has drifted back toward its original view. The justices’ invocations of the distinction between “noxious” and “innocent” uses have been more tentative and awkward than in the period before 1960, but nevertheless have been increasing.

 

The Court’s opinion in Loretto v. Teleprompter Manhattan CATV Corp. furnishes a more straightforward illustration of the power of the economic argument. At issue in the case was a New York statute empowering a cable television company to install fixtures on the sides and roofs of privately owned buildings. In holding that such a “permanent physical occupation” of private property, no matter how trivial, always constitutes a taking, Justice Marshall relied twice on Michelman’s 1967 article – first, for Michelman’s analysis of the historical development of the physical-occupation rule; and second for his defense of the rule as effective way of identifying situations involving both low settlement costs and high demoralization costs.

 

The newer and more refined variations on the economic theme, however, have had little if any impact on judicial decisions in this field. In particular the danger – widely recognized by scholars – that liberal grants of compensation to property owners adversely affected by government action will give rise to a “moral hazard” problem, leading to inefficiently high levels of investment in improvements likely to be rendered valueless by subsequent regulation seems to have fallen on deaf judicial ears.

 

Equally troublesome is the tendency of judges (or their law clerks) to misuse economic arguments – or at least to deploy them in ways their originators would have found surprising and distressing. Perhaps the clearest illustration of such misuse concerns the fate of the phrase: “discrete, investment-backed expectations.” Toward the close of his 1967 article Michelman provided a brief, avowedly utilitarian defense of the venerable and much-maligned “diminution in value” test for determining whether a statute had effected a taking. The true justification of the test, he argued, is that, like the physical-invasion test, it mandates compensation in situations in which property owners will experience severe psychological injury. Recognition of this justification, Michelman went on to argue, requires that we reconceive the test slightly:

 

 

More sympathetically perceived, however, the test poses not [a] … loose question of degree; it does not ask “how much,” but rather … it asks “whether or not”: whether or not the measure in question can easily be seen to have practically deprived the claimant of some distinctly perceived, sharply crystallized, investment-backed expectation.

 

 

In his Penn Central opinion, Justice Brennan several times invoked the language with which Michelman closed his discussion – without recapitulating, however, the argument on which it was based. Cut loose from its moorings, Michelman’s proposed test has since been put to some surprising uses. For example, in Kaiser-Aetna v. United States, the owner of a resort and marina in Hawaii argued that, by granting it permission to convert a shallow, landlocked lagoon into a bay accessible to pleasure boats, the Army Corps of Engineers had forfeited the right subsequently to declare the bay a navigable waterway open to the public – unless, of course, it compensated the marina owner. Emphasizing the large amount of money the petitioner had invested in the project, Justice Rehnquist and a majority of the Court agreed. A well-established factor in assessing takings challenges, Rehnquist held, is the extent to which the challenged government action “interfere[s] with reasonable investment backed expectations.” In the case at bar, the interference plainly had been substantial. Whatever one thinks of the merits of the ruling, it is considerably removed from Michelman’s original point, namely, that total or nearly total devaluation of a distinct property interest (something that plainly did not occur in Kaiser-Aetna) should be deemed a taking because of its likely psychic impact on the owner of the property.


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