By: Jennifer C. Paul, Condemnation & Unconstitutional Takings and Litigation Attorney

The recent U.S. Supreme Court Case, Knick v. Twp. of Scott, Pennsylvania, 139 S Ct 2162, 204 L Ed 2d 558 (2019))—opinion issued June 21, 2019—may change the landscape for private property owners bringing claims against the government for unlawful takings of their private property, opening a new federal claims path earlier in the process.

The Landscape Pre-Knick:

The Takings Clause of the Fifth Amendment states that “private property [shall not] be taken for public use, without just compensation.” Likewise, Article I, Section 18 of the Oregon Constitution states “Private property shall not be taken for public use, * * * without just compensation.” However, government entities often enact regulations and ordinances that impose restrictions on the use of private property (possible regulatory takings) or governments physically invade private property without filing a direct commendation action or paying just compensation (inverse condemnation/unlawful takings). In those situations, what remedy can the private property owner pursue?

Prior to the Knick case, Williamson County Regional Planning Comm’n v. Hamilton Bank of Johnson City, 473 US 172, 105 S Ct 3108 (1985) was the law of the land.  Williamson County, held that a private property owner’s claim for violation of the Fifth Amendment was not ripe until the property owner had exhausted its state court remedies and been denied just compensation under the state law. In other words, the private property owner could not bring a Fifth Amendment claim in federal court at the outset—the property owner must first engage in state litigation prior to filing in federal court.

However, the Supreme Court later held, in San Remo Hotel, L.P. v. City of County of San Francisco, 545 US 323 S Ct 2491 (2005), that when a property owner’s claim is determined in state court, normally that has a preclusive effect on any later federal suit.  By complying with the state-litigation requirement in Williamson County, in most cases the property owner is necessarily foreclosing their right to a federal forum.

Knick’s Summary/Holding:

The private property owner in Knick owned a single-family home on land used for grazing farm animals.  The land also included a small gravesite where the neighbors’ ancestors were buried. At issue was an ordinance that required all cemeteries be kept open and accessible to the general public and allowed Township officers to enter any property to determine the location of cemeteries.

After receiving notice of her violation of the above-referenced ordinance, the property owner in Knick first brought a declaratory action seeking injunctive relief from the ordinance in state court (but did not bring an inverse condemnation claim for just compensation).  In response, the Township withdrew the notice and stayed enforcement of the ordinance, resulting in the state court dismissing the proceeding, as no evidence of irreparable harm could be established for the equitable relief.  Next, the property owner filed a federal claim under 42 USC Sec. 1983, alleging that the ordinance violated the Takings Clause of the Fifth Amendment. The federal claim was dismissed pursuant to Williamson County, because the property owner did not pursue her inverse condemnation claim first in state court.

Ultimately, the Supreme Court in Knick overruled Williamson County’s state-litigation requirement, and now no longer requires state litigation prior to bringing a Fifth Amendment Claim. The Knick Court said, “[i]f a local government takes private property without paying for it, that government has violated the Fifth Amendment—just as the Takings Clause says—without regard to subsequent state court proceedings. And the property owner may sue the government at that time in federal court for the ‘deprivation’ of a right ‘secured by the Constitution.’” Knick, 139 S Ct at 2170 (citing 42 USC Sec. 1983).

Practical Outcomes for Oregon Property Owners:

For property owners facing an unlawful taking of their private property by the government, the Knick case means access to federal claims or to the federal courts earlier in the process of challenging government action.  For Oregon property owners, Knick means they can advance their claims under the Fifth Amendment rather than having to rely on Oregon’s Constitution, Article 1, Section 18, and Oregon common law, which may be less favorable than federal law.  For example, under Oregon law, in the context of a regulatory taking claim, a private property owner only has a claim if the subject ordinance/rule leaves the owner with no economically viable use for the entire property.  However, now property owners may bring a Fifth Amendment claim, at the outset, with a potentially more favorable outcome utilizing the federal “Penn Central Doctrine.”  Such claims could be brought in federal court, of course, but also in Oregon, under Boise Cascade Corp. v. Bd. of Forestry, 325 Or 185, 935 P2d 411 (1997), such federal claims may be brought directly in state court.

The bottom line is that Knick opens new paths and strategies for private property owners in protecting their constitutional rights.  The condemnation attorneys at Saalfeld Griggs can help property owners navigate this new landscape.

Jennifer Paul is a partner in the Condemnation &  Unconstitutional Takings and Litigation practice groups, and a member of the firm’s Agri-Business and Construction Industry Groups. The information in this article is not intended to provide legal advice. For professional consultation, please contact Jennifer Paul at Saalfeld Griggs PC.  503.399.1070.  [email protected]  © 2019 Saalfeld Griggs PC

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