Introduction and decision.

• Author: Watters, Lawrence
• Position: A Colloquium on Lucas

1. Introduction

   The taking issue has displayed wilderness characteristics of the dark wood in which Dante became entangled during his legendary descent into the Inferno.(1) The path has been obscured; the compass has been obliterated; and the map is out of date.(2) Once the U.S. Supreme Court finally had the opportunity to define the scope of a regulatory taking in Lucas v. South Carolina Coastal Council,(3) the decision was the subject of much anticipation. It is apparent that the Lucas case is important for the practice of land use, natural resources, and environmental law. But as one scholar observed, the decision is enigmatic.(4) What does the opinion mean and does it offer any guidance through the dark wood of taking? These are the questions this Colloquium explored.

2. Elements of the Case

   1. Lucas' Property and the Beachfront Management Act

      In 1986, David Lucas purchased two lots in the Wild Dunes development on the Isle of Palms in South Carolina.(5) The Isle of Palms is a barrier island east of the city of Charleston.(6) Lucas, who has lived in the vicinity since 1978, is a contractor, manager and part owner of the development.(7) He purchased the property to construct houses there.(8) Neighbors had built on both sides of his lots.(9)

      In about half of the preceding forty years, all or part of Lucas' property was beach or flooded twice daily by the ebb and flow of the tide.(10) From 1957 to 1963, the property was under water.(11) Between 1963 and 1973, the shoreline was 100 to 150 feet onto the property.(12) Between 1981 and 1983, the Isle of Palms issued twelve emergency orders to safeguard the property in the development.(13) The Coastal Council had issued permits for two rock revetments to protect condominiums near Lucas' property. One of those revetments extended more than halfway onto one of Lucas' lots.(14)

      Under the Coastal Zone Management Act of 1972 (CZMA), Congress authorized the states to enact comprehensive programs for the conservation and use of coastal resources.(15) In response, South Carolina adopted a coastal zone management act in 1977.(16) The statute authorized the designation of "critical areas" within which changes in land use required a permit from the South Carolina Coastal Council.(17) The statute defined a critical area to include beaches and sand dunes in the shoreline area.(18) The lots purchased by Lucas in 1986 were not in a critical area so the statute did not require him to obtain a permit from the Coastal Council to develop the property.(19)

      In 1987, a committee appointed by the Coastal Council found that the state's beaches were "critically eroding" and recommended new land use restrictions.(20) The legislature responded to the proposals of the committee by adopting the Beachfront Management Act in 1988.(21) The Act did not change the uses permitted within a critical area.(22) Instead, it enlarged those areas, requiring the Coastal Council to establish a "baseline" connecting the landward-most "points of erosion ... during the past forty years" using "the best scientific and historical data" available.(23) The agency fixed the baseline where the shoreline had been in 1963. (Figure 1.). This line was landward of the Lucas property,(24) and brought Lucas into the enlarged critical area which the Act regulated. This action prohibited Lucas from constructing permanent structures on his lots.(25) The Act provided no exceptions.(26)

      The 1988 Act authorized both administrative and judicial challenges to the baseline and the newly enlarged critical area.(27) Lucas did not utilize these remedies.(28) Thus, the Coastal Council never finally determined whether the property of Lucas was "correctly categorized as a critical area in which building would not be permitted."(29)

   2. Decision of the Trial Court

      Lucas brought suit against the Coastal Council in state court. He contended the restriction on the use of his property was a taking without just compensation in violation of the Fifth Amendment to the U.S. Constitution.(30) At trial, Lucas presented testimony from an appraiser that the "highest and best use of these lots ... [is] luxury single family detached dwellings."(31) The Act, the appraiser contended, caused "the value of the lots to plummet to zero."(32) They lacked "fair market value and there [remained] no economically viable use."(33) The appraiser stated that each lot was previously worth $650,000, but that the action of the Coastal Council caused them to retain "no value."(34)

      The Coastal Council presented the testimony of an engineer who qualified as an expert in coastal development.(35) The engineer described the extensive erosion in the area due to storms and to siting of new developments.(36) He identified the setback line established by the agency for the Lucas property based on the most landward point of erosion over the past forty years coupled with a twenty-foot "no construction line."(37) He testified that "fifty percent of the time the beach has occupied part or all of the Lucas property over the last forty years."(38)

      The Coastal Council also offered testimony of an appraiser who stated each lot was worth about ten percent of what it was prior to the application of the Act or about fifty-six thousand dollars per lot.(39) This testimony was stricken by the court as "pure speculation."(40)

      The court ruled in favor of Lucas.(41) The court found that at the time Lucas purchased the lots, they were zoned for single family residential construction.(42) The court also found that the restriction on the property rendered it valueless.(43) The court awarded $1.2 million dollars as "just compensation for the |regulatory' taking" caused by the Act.(44)

   3. Decision of the South Carolina Supreme Court

      The Coastal Council appealed and the South Carolina Supreme Court reversed.(45) The court determined that the case raised a "relatively straightforward issue" while noting the taking...