Lucas: a flawed attempt to redefine the Mahon analysis.

• Author: Large, Donald
• Position: A Colloquium on Lucas

The South Carolina majority in Lucas,(1) in upholding the Beachfront Management Act,(2) reverted to the takings test that prevailed before the U.S. Supreme Court decided Pennsylvania Coal in 1922.(3) Despite the Court's rejection of that test in Mahon, the test has continued to pop up every so often since then.(4) The state court reasoned that since there was a valid public purpose behind the South Carolina Act, in essence the prohibited conduct became a noxious use, and, therefore, was not protected as property by the takings clause.(5) The U.S. Supreme Court, of course, reversed the South Carolina court's holding that the Act was not a taking, disagreed rather emphatically with their analysis, and then sent it back for reconsideration under the new standard as stated.(6)

Essentially, the Supreme Court majority applied Justice Holmes' two-part analysis from the Mahon case(7) rather than Justice Brandeis' dissenting analysis from the same case(8) which was more consistent with the preexisting test developed in Mugler v. Kansas.(9) The Lucas Court reasoned that even though the purpose of South Carolina's law was valid, that validity didn't insulate the law from scrutiny over whether it constituted a takings because the law too severely diminished the value of Lucas' land. Of course, the Lucas case presents either a total or a close-to-total loss of market value, so the probable result under the Mahon analysis was obvious from the start. Consequently, I thought the Lucas holding by itself wasn't particularly earth shattering.

There are several major decisions since Mahon where the Court has just ignored that analysis where convenient, such as Goldblatt v. Town of Hempstead,(10) Miller v. Schoene,(11) and Keystone Bituminous Coal Ass'n v. DeBenedictis.(12) But the Lucas majority's result, if not all of their opinion, is completely consistent with the Mahon analysis. Essentially, petitioner Lucas was totally wiped out by a regulation enacted after he purchased the property. The deprivation of property value, especially considering the $900,000 mortgage he assumed to buy the land, was certainly well over Holmes' vague indefinable line(13) and into the taking category.

For me, the most interesting part of the case was how the majority framed the opinion. It always bothers me when every Justice on every side of a takings case has to pretend that all the previous takings cases are consistent with their line of reasoning. I thought both Justices Scalia and Blackmun weakened their arguments by trying to make every takings case in the last 100 years consistent with what they were saying. They would have done better to admit that there are some they couldn't square.

Dealing first with Justice Scalia's majority opinion, the problem is: how can he explain that long line of cases emanating from Mugler, in which the Court has sustained, against takings attacks, laws that caused land owners in effect to loose 100% of the market value.(14) Justice Rehnquist, in some of his earlier opinions, attempted to explain these cases by labelling them "nuisance" or "noxious" use cases.(15) Harking back to the old aphorism that there is no property right in a nuisance, Rehnquist argued that these cases fell into a nuisance exception to the usual takings analysis.(16) From that perspective, the issue becomes: how broad is this nuisance exception? If it covers every instance where the state has authority to regulate, then it completely swallows up Holmes' basic rule that at some point an extreme decline in value can...