Monday, November 16, 2020

Takings and Time

 by Michael C. Dorf

On Friday the Supreme Court granted certiorari in Cedar Point Nursery v. Hasid, a case that pits labor rights against property rights. Given the Court's current personnel, the odds seem pretty clearly stacked in favor of the latter. Here, I'll briefly describe the case but mostly set aside the ideological stakes. Instead, I'll focus on a mathematical issue that the case presents and that arises in other contexts as well.

A longstanding regulation in California grants union organizers access to workers at agricultural workers on private property. The rule allows such access for up to three hours per day for up to thirty days at a time for up to four thirty-day periods per year. Union organizers used the rule to gain access to privately owned strawberry fields and orchards growing grapes and citrus fruit. The owners of these properties complained that the access was disruptive and, more importantly for present purposes, unconstitutional. They claimed that the state, by empowering the labor organizers to gain access to their property, had affected an unreasonable seizure in violation of the Fourth Amendment and/or a taking without just compensation in violation of the Fifth Amendment. The property owners lost in the Ninth Circuit and then successfully sought review in the SCOTUS with respect to the takings claim.

Property owners challenging so-called regulatory takings can succeed either by showing that the regulation destroys all economically viable use of the property or that it "goes too far." Neither of those tests is satisfied here, but the plaintiff property owners do not claim that the California regulation works a regulatory taking at all. Relying instead on a line of cases typified by Loretto v. Teleprompter Manhattan CATV Corp., they contend that the California regulation is a taking because it is "permanent physical occupation of [the] owner's property."

Loretto involved a NYC ordinance requiring apartment building owner to grant access to cable companies to install cables and cable equipment on their property. Because the placement of the cables and equipment made the (small) portions of the buildings thus occupied entirely unavailable to their owners for other uses, the Court deemed the ordinance a taking, for which just compensation was required.

The Ninth Circuit thought that the Loretto "permanent physical occupation" line of cases was inapplicable, treating the California regulation as more analogous to a permissible restriction on property rights in PruneYard Shopping Center v. Robins. There, the California Supreme Court determined that the California Constitution granted the public a right to free speech in a privately owned shopping center. The owner of the shopping center argued that by granting strangers a right to speak on its property, California had (among other things) taken its property. The SCOTUS disagreed in its PruneYard decision. In Cedar Point Nursery, the Ninth Circuit said that just as there was no taking in PruneYard when California granted speakers the right to make their points on the private property of a shopping center, so there is no taking when California grants different speakers (labor organizers) the right to make their points on the private fields and orchards.

The property owners argued unsuccessfully in the Ninth Circuit that PruneYard was not analogous because shopping center owners invite the public onto their property, whereas growers do not. They renewed that argument in their cert petition, citing more recent cases that describe PruneYard as a relatively narrow case that only applies to publicly accessible places like shopping malls.

For present purposes, I'll assume that petitioners are correct that PruneYard is inapplicable. Even so, to prevail, they'll have to show that a right of access that applies for a maximum of 360 hours (3 hours per day for 120 days per year) out of 8,760 hours in a year--i.e., for a maximum of only 4% of the time each year--counts as "permanent" within the meaning of Loretto. Does it?

That is partly a semantic question. For the petitioners, we can note that we sometimes use the word "permanent" to mean never-ending even if not continuous. "Permanent" in this sense means something like "in perpetuity." For example, if a sports franchise grants a retired athlete a pair of "permanent season tickets" for the athlete and his heirs, that entitles the athlete and his heirs to tickets to two seats for games into the indefinite future, even though it does not entitle the athlete to occupy the seats when no games are being played. It would be consistent with the grant of permanent season tickets to the team's games to require the athlete to purchase tickets if he wanted to attend a concert or some other event at the stadium, or to bar him from the stadium when no events are occurring and it is thus closed to the public.

Moreover, we can see how the law could sensibly deem a rule barring permanent occupations to be violated by a nearly continuous occupation. If in Loretto, the cable company removed its equipment for an hour each year, that would hardly render the case appreciably different. Likewise, a continuous but time-limited occupation of real property should fall within the Loretto category if the time limit is sufficiently long. Suppose that the cable company planned to keep its equipment on each building for only fifty years. Surely that would deprive the property owner of something with substantial value. If the actual deprivation in Loretto counts as a taking, it is hard to see why a long-lasting but technically not permanent one oughtn't to as well.

In a sense, the issue I am surfacing here is a temporal version of a spatial puzzle for regulatory takings. A regulation that deprives the property owner of all economically viable use of the property is a taking, but if the property owner is left with some residual use, then we are thrown back on Holmes's unhelpful statement in the Pennsylvania Coal case of "[t]he general rule . . .  that while property may be regulated to a certain extent, if regulation goes too far it will be recognized as a taking." Apart from the emptiness of that "test," there is the further problem of a kind of cliff effect. It is very difficult for a property-owning plaintiff to prove that a regulation that falls short of destroying all economically viable use goes too far, but once the regulation crosses the threshold from very restrictive to completely restrictive, a per se rule kicks in.

Is that how things work along the temporal dimension as well? Do we have a regime in which only permanent occupations fall within Loretto, while everything else is relegated to the Holmesian too-far test? One might think not, given that cases like First English Evangelical Lutheran Church v. County of Los Angeles recognize the possibility that a temporary property deprivation can constitute a compensable regulatory taking. But First English does not resolve Cedar Point because in First English the temporary taking was of all the land's use.

As readers may have by now surmised, I find takings doctrine more than a bit puzzling--perhaps because I am a legal realist about property. The Takings Clause seems to assume that there is some pre-regulatory Lockean natural baseline against which regulations can be judged takings or not. Yet that's false. Property rights are a legal construct. If the state forbids you to frack for natural gas on your land because the chemicals you inject into the ground pose a health or safety risk, we could say that the state has taken some of your property, but only if we think that property rights come with a right to frack. In the Lucas case, the Court would have allowed restrictions on land use that corresponded to prior restrictions in the law of property or nuisance, but that way of thinking, it seems to me, reifies the common law, treating old sorts of restrictions as somehow more legitimate than newer ones based on such considerations as environmental science.

All that said, I recognize that the Constitution does contain a Takings Clause. Were I writing on a blank slate, I'd be tempted to say that where regulation rationally serves the broad public interest, it does not amount to a taking. I would treat true appropriations as takings and, to prevent governments from circumventing the obligation to pay just compensation for true appropriations, I would treat regulations that can only be reasonably understood as disguised appropriations as takings as well.

Perhaps the best that can be said for the regime we have is that it approximates the regime I have just described, but only if the per se categories (regulations that destroy all economically viable use and permanent physical invasions) are kept narrow. Applying such a stringent requirement, the plaintiffs in Cedar Point should lose, because the access given to labor organizers does not come close to a permanent physical invasion. However, they will probably win, because this Lockean Court hates organized labor almost as much as it loves property rights.