FEDERAL COURTS AND TAKINGS LITIGATION.

• Author: Woolhandler, Ann

INTRODUCTION

Disagreement about takings claims extends to both substantive and jurisdictional issues. Those favoring deference to land use regulation as a substantive matter would minimize the role of the federal courts in takings disputes. (1) Those favoring less substantive deference to governmental land use decisions argue that takings claims should be treated as favorably as are other federal constitutional rights that can readily be brought in federal courts under the Civil Rights Act of 1871, 42 U.S.C. [section] 1983. (2)

Both sides of the dispute emphasize different aspects of the role that the federal courts have traditionally played with respect to takings claims. Those favoring deference to government land use decisions treat the federal courts' assuming a more active role as an unjustified reversal of the New Deal's adoption of deferential review for economic rights. (3) On the other hand, property rights advocates argue that sidelining takings cases "was never intended by the Congress when it enacted the Civil Rights Act of 1871," (4) and that federal court abstention in land use cases flouts the "Congressional mandate to adjudicate claims brought under 42 U.S.C. [section] 1983." (5)

These differences were brought into sharp relief by the Supreme Court's recent decision in Knick v. Township of Scott. (6) Knick overruled Williamson County v. Hamilton Bank, (1) which had treated many takings claims as unripe until the property owner had unsuccessfully sought just compensation in the state courts, on the theory that the Constitution only addressed deprivations for public use when compensation was found to be lacking. The owner could petition for Supreme Court review of the state court determination, but San Remo Hotel v. San Francisco made clear that preclusion would generally bar the disappointed owner from bringing a subsequent action in the lower federal courts. (8) In Knick, the Supreme Court held that a property owner could immediately resort to a lower federal court, without first pursuing compensation in state court.

While Knick clearly expands the lower federal court role in takings claims, many questions remain. We do not know how federal courts will respond to the increase in claims--whether they will embrace a robust federal role in land use cases, or use various abstention doctrines to rein them in.' (1) While pro-regulatory and pro-property rights scholars have predictably taken sharply contrasting positions as to the appropriate federal court role post-Knick, (10) this Article will recommend a middle-of-the-road approach, based partly on history and partly on an assessment of where the lower federal courts may most usefully contribute to the fair determination of takings claims.

This Article first gives an overview of the role of the federal courts in takings claims over time, with a view to providing a more complete picture than that supplied by focusing either on the Lochner/New Dealera dichotomy or on the advent of the f 871 Civil Rights Act (current [section] 1983). It traces the fairly robust role of the federal courts in protecting property under a nonconfiscation norm both before and during the Lochner era. It also points out that the legislative history of the 1871 Civil Rights Act does not support a firm conclusion that Congress intended takings claims to be litigable under [section] 1983. And [section] 1983 thereafter played little role in takings cases, which were generally pursued as claims under diversity jurisdiction or under the federal question statute, 28 U.S.C. [section] 1331. (11)

The New Deal saw the federal courts' retreat from the nonconfiscation norm, and the rise of abstention doctrines that reduced the federal court role in adjudicating such claims. But the retreat from stringent substantive standards, as well as from federal court jurisdiction, were more muted in takings claims than in other types of economic claims. The history thus indicates that the lower federal courts maintained a moderately active role in land use decisions during the nineteenth century and during most of the twentieth century.

It was only with the Court's 1985 decision in Williamson County that the Supreme Court reduced the federal courts' role in takings to an extent comparable to the New Deal decline with respect to other economic rights. That decision offset for a time the potential increase of takings claims that might have arisen from the Court's 1978 decision in Monell v. Next) York Department of Social Services, ([)- which held that municipalities were suable persons under [section] 1983. (13)

Going forward alter Knick's overturning Williamson County, we ask: What role should the federal courts play? The demise of Williamson suggests that the federal courts may significantly increase their role in land use decisions, (14) but it may also suggest that they will more actively use abstention doctrines to reduce Knick's impact. (15) We evaluate the use of Pullman (16) and Burford (11) abstention doctrines in takings claims, and find them inapt. We suggest an abstention doctrine specially for takings cases that would sort out cases where the federal courts are most likely to contribute to fair applications of the law. Finally, we suggest that constitutionally-based actions brought under [section] 1331 may be better homes for takings cases than [section] 1983 actions.

Part I of this Article traces the role of the federal courts in the adjudication of takings claims both before and during the Lochner era. Part II traces the New Deal development of abstention doctrines in areas of economic rights, but also addresses the somewhat lesser use of abstention for takings cases. It also describes the subsequent role of the federal courts, including the late addition of takings cases as encompassed within [section] 1983, the import of which was soon minimized by Williamson County. Part III addresses the role the federal courts should play post-Knick. It analyzes whether Pullman and Burford abstention are a good fit for takings claims. (18) It then outlines categories of claims for which lower federal court jurisdiction may be more and less warranted. Finally, it suggests that constitutional claims under the federal question statute rather than [section] 1983 may be a better vehicle for federal courts takings claims, Knick notwithstanding.

1. PROPERIY BASED CLAIMS THROUGH THE LOCHNER ERA

   1. Early Republic

      The American colonies' governance instruments often included protections for property rights. (l9) Under the Articles of Confederation, however, many states failed to honor treaty provisions with Great Britain, including provisions that no further confiscations of British and Loyalist property should occur post-war, and that prewar British debts should be paid. (2)" In addition, state legislatures' enactments of debtor relief statutes and issuance of paper currency alarmed many citizens and served as an impetus for 1787 Convention and the new Constitution. (21)

      The Constitution of 1787 manifests the Framers' desire to protect interests in property and contract in various provisions, including in its provision for federal courts. (22) Concerns about confiscation and contract non-enforcement helped to motivate the Supremacy Clause's provision that treaties as well as other federal law would be the supreme law of the land. (23) And the Constitution prohibited states' impairing the obligations of contract, coining money, and issuing bills of credit. (24) The Bill of Rights proscribed the federal government's depriving life, liberty, and property without due process and taking property without just compensation. (25)'

      The anticonfiscation norm would prove central to the Supreme Court's nineteenth-century jurisprudence, (26) and the federal courts did not shy from entertaining cases raising takings issues. Prior to the Fourteenth Amendment and the Court's more explicit treatment of takings as violations of the Due Process Clause, the Court used treaty provisions, (27) the Contract Clause, and the general common law to provide redress for state and local takings.

      Civen the lack of general federal question jurisdiction before 1875, cases that raised takings issues in the lower federal courts invoked diversity (28) or some other existing basis for jurisdiction. The suits took a variety of forms. Where state legislation purported to divest a party of title, an action between private claimants could raise the issue of whether the state legislation could be given effect. For example, in Fletcher v. Peck, the Court, in a suit between private parties, held that the state could not retract a prior land grant without violating the Contract Clause. (29) Using general law principles in Terrell v. Taylor, the Court held that Virginia laws transferring Episcopal Church property to the county overseers of the poor should be treated as having no force, and it enjoined the overseers from claiming the property. (30) In addition, the federal courts, as did the state courts, enjoined private companies authorized by governments to build roads from invading the owners' property absent adequate provisions for compensation. (31) The federal courts might also award monetary relief. For example, in Pumpelly v. Green Bay Co., the Court in a diversity case upheld a damages action for trespass on the case against a company that had huilt a dam flooding plaintiffs land. (32)

      When governments or their contractors employed eminent domain powers, many states provided for administrative proceedings with initial determinations of value by commissioners or juries, with a subsequent appeal de novo to a regular state court. Property owners sometimes brought the appeals as original actions against contractors or local governments (33) in lower federal courts in diversity. The condemnor/defendants argued against lower federal court jurisdiction, on the grounds that the review proceedings were not civil cases and that eminent...